Job losses slow as unemployment dips for the first time in 15 months
Employers sharply scaled back layoffs in July, and the unemployment rate dipped for the first time in 15 months, sending a strong signal that the worst recession since World War II is finally ending. A net total of 247,000 jobs were lost last month, the fewest in a year. That compares with 443,000 jobs that disappeared in June. And the unemployment rate for July declined to 9.4 percent from 9.5 percent in June. The snapshot the Labor Department released Friday offered other encouraging news, too: Workers' hours nudged up after sinking to a record low in June, and paychecks grew after having stagnated or fallen.
U.S. retailers reported their 11th straight month of sales declines in July as shoppers continued to search for bargains and basics in the downturn. Rising unemployment, cool weather and a lack of tax-free holidays like those in July 2008 kept shoppers at home or buying just what they needed last month, rather than stocking up heavily on back-to-school items.
July sales at stores open at least a year, a measure known as same-store sales, fell 5.1 percent from a year earlier, compared with June's 4.9 percent decline, according to Thomson Reuters data. Sales may also have been hurt by consumers buying new cars under the "Cash for Clunkers" program, siphoning money away from other spending, said Ken Perkins of Retail Metrics.
In July 2009, average hourly earnings in manufacturing were $18.19, up 0.33 percent from June 2009’s $18.13 (preliminary), and up 2.59 percent from July 2008’s $17.73.
(BLS/DOL Employment data from “The Employment Situation: August 7, 2009, USDL 09-0908,” released July 2, 2009; next release is September 4, 2009)
http://www.bls.gov/news.release/pdf/empsit.pdf
Manufacturing Wage Rates (Quarterly, Yearly)
Hourly compensation in manufacturing grew 13.4 percent during the first quarter of 2009, reflecting a 15.8 percent rise in durable goods industries and a 10.1 percent rise in the nondurable goods industries (seasonally-adjusted annual rates).
Real hourly compensation, which takes into account changes in consumer prices, increased 16.1 percent for all manufacturing workers.
In 2009, hourly compensation of all manufacturing workers grew 8.4 percent, compared to a 4.1 percent increase in 2008. Real hourly compensation in the total manufacturing sector rose 8.7 percent in 2009 after increasing by 0.3 percent in 2008.
(BLS/DOL Productivity data from “Productivity and Costs, USDL 09-0587 First Quarter, Revised,” released June 4, 2009; next release is August 11, 2009)
http://www.bls.gov/news.release/pdf/prod2.pdf
In the first quarter of 2009, manufacturing profits decreased 18.2 percent, or $27.0 billion, to $121.6 billion from $148.6 billion in the fourth quarter. Compared with first quarter profits of 2008, manufacturing profits were down $66.0 billion in the first quarter of 2009.
First quarter 2009 profits estimates for all non-financial industries (manufacturing being a subcategory) increased 2.9 percent from the fourth quarter of 2008 to $758.0 billion.
NOTE: This update reflects “the comprehensive (or benchmark) revision of the national income and product accounts (NIPAs). More information on the revision is available on BEA’s Web site at www.bea.gov/national/an1.htm, including links to an article in the March 2009 issue of the Survey of Current Business that discussed the changes in definitions and presentation that have been implemented in the revision and to an article in the May Survey that described the changes in statistical methods.”
In July 2009, manufacturing employment fell by 52,000 when compared with June’s (preliminary) manufacturing employment levels.
In July, durable goods manufacturing lost 32,000 jobs, with decreases in most categories: Machinery (-15,200), Fabricated metal products (-14,100), Computer and electronic products (-7,400), Electrical equipment and Appliances (-5,100), Wood products (-5,000), Furniture and related products (-4,900), Miscellaneous manufacturing (-3,700), Nonmetallic mineral products (-2,100), and Primary metals (-1,800). However, an increase in employment was registered in Transportation Equipment (27,600).
In July, nondurable goods manufacturing lost 20,000 jobs. Job losses occurred in most categories: Plastics and rubber products (-7,100), Printing and related support activities (-4,800), Paper and paper products (-2,800), Chemicals (-2,600), Textile mills (-2,000), Food manufacturing (-900), Textile product mills (-800), Beverages and tobacco products (-700), and Petroleum and coal products (-500). However an increase in employment was registered in Apparel (1,000), and Leather and allied products (500).
• The manufacturing employment of 11.8 million workers represents 9.0 percent of total non-farm employment.
(BLS/DOL Employment data from “The Employment Situation: June 2009, USDL 09-0908,” released August 7, 2009; next release is September 4, 2009)
http://www.bls.gov/news.release/pdf/empsit.pdf
In June 2009, manufacturing output fell 0.6 percent and was 15.5 percent below its year-earlier level.
The production index for durable goods declined 0.7 percent. The durable manufacturing industries that registered decreases in output of more than 1 percent included Motor vehicles and parts (-2.6 percent), Machinery (-1.9 percent), Electrical equipment, appliances, and components (-1.5 percent), Computer and electronic products (-1.1 percent). However, increased production was registered in Wood products (1.8 percent), Primary metal (1.7 percent), Miscellaneous (0.9 percent), Aerospace and miscellaneous transportation equipment (0.3 percent).
The production of nondurable goods decreased 0.4 percent. Industries that registered notable decreases in output of more than 1 percent included Apparel and leather (-4.9 percent), Chemical (-1.0 percent). However, increased production was registered in Printing and Support (1.1 percent), Plastics and rubber products (0.7 percent), Petroleum and coal products (0.7 percent), Textile and products mills (0.5 percent).
The index for other manufacturing industries (non-NAICS) decreased 0.5 percent in June.
In June 2009, manufacturing industries (NAICS based) operated at 64.7 percent of capacity, 14.7 percentage points below their 1972-2008 average of 79.4 percent and 0.3 percentage points lower than their revised capacity utilization in May 2009.
In durable manufacturing, capacity utilization decreased 0.3 percentage points in June from May (revised) to 57.8 percent. This reflects declines in capacity utilization in Machinery (-1.0 points), Electrical equip., appliances, and components (-1.0 points), Computer and electronic products (-0.9 points), Motor vehicles and parts (-0.8 points), Nonmetallic mineral products (-0.3 points), Fabricated metal products (-0.3 points), Furniture and related products (-0.1 points). Increase capacity utilization was registered in Wood products (1.00 points), Primary metal (0.8 points), Miscellaneous (0.6 points), Aerospace and miscellaneous transportation equipment (0.2 points).
Capacity utilization in non-durable manufacturing in June decreased 0.2 percentage points from May (revised) to 72.3 percent. Decreased capacity utilization was registered in Apparel and leather (-3.0 points), Chemical (-0.6 points), Paper (-0.5 points), Food, beverage, and tobacco products (-0.3 points). Increased capacity utilization was registered in Printing and support (1.1 points), Textile and product mills (0.7 points), Petroleum and coal products (0.6 points), Plastics and rubber products (0.6 points).
Productivity decreased at a 2.7 percent annual rate in the manufacturing sector during the first quarter of 2009, reflecting a 21.7 percent decrease in output and a 19.5 percent decrease in hours. These were the largest-ever declines in the output and hours series, which begin with data for the second quarter of 1987. Over the last four quarters, manufacturing productivity fell 3.2 percent, the largest four-quarter decline in the series. This contrasts with the 3.7 percent average annual increase from 2000 to 2007.
In the durable goods manufacturing subsector, output declined 31.0 percent and hours fell 23.0 percent, yielding a productivity decline of 10.4 percent.
In nondurable goods industries, productivity rose 1.9 percent as the decline in output of 11.6 percent was less than the 13.2 percent decline in hours.
(BLS/DOL Productivity data from “Productivity and Costs, USDL 09-0587 First Quarter 2009, Revised,” released June 4, 2009; next release is August 11, 2009)
http://www.bls.gov/news.release/pdf/prod2.pdf
Year to date May 2009, U.S. manufactured goods exports accounted for 82.1 percent of all U.S. exports of goods, compared with 81.0 percent a year ago. Manufactured goods exports in May were 3.1 percent higher than previous month, while imports were down 2.8 percent. Year to date May 2009’s trade deficit in manufactured goods of $115.2 billion was $67.4 billion less when compared with $182.7 billion a year ago.
Shipments of manufactured durable goods in June, down eleven consecutive months, decreased $0.3 billion or 0.2 percent to $168.3 billion. This was the longest streak of consecutive monthly decreases since the series was first published on a NAICS basis in 1992 and followed a 2.6 percent May decrease.
Computers and electronic products, down five of the last six months, had the largest decrease, $0.4 billion or 1.6 percent to $27.4 billion. Shipments also decreased in Primary metals (-0.5 percent), and Electrical equipment, appliances and components (-0.3 percent). However, shipments increased in Transportation equipment (0.8 percent), Machinery (0.5 percent), and Fabricated metal products (0.3 percent).
In June 2009, the Producer Price Index (PPI) for finished goods, except foods and energy, increased by 0.5.
The index for finished energy goods was up 6.6 percent in June. The index for Gasoline price increased 18.5 percent, liquefied petroleum gas 14.6 percent, Home heating oil and distillates 15.4 percent, and No. 2 diesel fuel 14.6 percent. The index for Residential gas increased 2.5 percent in June after declining 4.7 percent in May. The index for residential electric power declined 0.9 in June.
Institute for Supply Management's (ISM) Index updated
Economic activity in the manufacturing sector failed to grow in July for the 18th consecutive month, while the overall economy grew for the third consecutive month, say the nation's supply executives in the latest Manufacturing ISM Report On Business®
Manufacturing contracted at a slower rate in July as the PMI registered 48.9 percent, which is 4.1 percentage points higher than the 44.8 percent reported in June. This is the 18th consecutive month of contraction in the manufacturing sector. A reading above 50 percent indicates that the manufacturing economy is generally expanding; below 50 percent indicates that it is generally contracting.
The percentage-point changes in the components of the PMI in July were: New Orders up 6.1 points to 55.3, Production up 5.4 points to 57.9, Employment up 4.9 points to 45.6, Supplier Deliveries up 1.4 points to 52.0, and Inventories up 2.7 points to 33.5.
Prepared by
Office of Trade Industry Information
Manufacturing and Services
International Trade Administration
U.S. Department of Commerce
(202) 482-2460-4691
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