Jobless rate at 9.7 percent; 216,000 jobs lost in August
The unemployment rate jumped almost half a point to 9.7 percent in August, the highest since 1983, reflecting a poor job market that will make it hard for the economy to begin a sustained recovery. While the jobless rate rose more than expected, the economy shed a net total of 216,000 jobs, less than July's revised 276,000 and the fewest monthly losses in a year, according to Labor Department data released Friday. Economists expected the unemployment rate to rise to 9.5 percent from July's 9.4 percent and job reductions to total 225,000. By contrast, in a healthy economy, employers need to add a net total of around 125,000 jobs a month just to keep the unemployment rate stable.
Productivity up 6.6 percent in 2Q, most in 6 years
Worker productivity, the single biggest factor determining living standards, grew at the fastest pace in nearly six years in the spring while labor costs fell by the most in nine years, as companies slashed costs to survive the recession. The Labor Department said Wednesday that productivity, the amount of output per hour of work, rose at an annual rate of 6.6 percent in the April-June quarter, the largest advance since the summer of 2003. Economists expected an increase of 6.4 percent, matching the government's initial estimate last month. Labor costs fell at an annual rate of 5.9 percent. That's the largest drop since the second quarter of 2000, and slightly bigger than the 5.8 percent decline estimated a month ago. Increases in productivity can help boost living standards because companies can increase wages financed by rising output. But during the recession, companies have been using their productivity gains to bolster their bottom lines as many struggle to stay in business.
In August 2009, average hourly earnings in manufacturing were $18.22, up 0.22 percent from July 2009’s $18.18 (preliminary), and up 2.64 percent from August 2008’s $17.75.
(BLS/DOL Employment data from “The Employment Situation- August 2009, USDL 09-1067,” released September 4, 2009; next release is October 2, 2009)
http://www.bls.gov/news.release/pdf/empsit.pdf
During the second quarter of 2009, hourly compensation grew 5.1 percent in total manufacturing, 7.9 percent in durable manufacturing and 1.5 percent in nondurable manufacturing. As revised, manufacturing hourly compensation decreased 0.4 percent in the first quarter.
When consumer prices were taken into account, real hourly compensation of all manufacturing workers rose 3.7 percent in the second quarter, and 2.0 percent in the first quarter of 2009.
In the second quarter of 2009, hourly compensation of all manufacturing workers grew 5.2 percent (annual rate from the same quarter a year ago), compared to a 2.3 percent increase during the second quarter of 2008. Real hourly compensation in the total manufacturing sector rose 6.2 percent in the second quarter of 2009 (annual rate from the same quarter a year ago), compared to 1.9 percent decrease in the second quarter of 2008.
(BLS/DOL Productivity data from “Productivity and Costs, USDL 09-1066 Second Quarter, Revised,” released September 2, 2009; next release is November 5, 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 August, 2009, manufacturing employment continued to trend downward, with a decline of 63,000.
In August, durable goods manufacturing lost 51,000 jobs, with decreases in all categories: Transportation equipment (-16,000), Computer and electronic products1 (-8,300), Fabricated metal products (-8,200), Machinery (-4,600), Wood products (-3,200), Furniture and related products (-3,200), Nonmetallic mineral products (-2,700), Miscellaneous manufacturing (-2,300), Electrical equipment and appliances (-1,500), and Primary metals (-1,400).
In August, 2009, nondurable goods manufacturing lost 12,000 jobs. Job losses occurred in most categories: Printing and related support activities (-4,900), Chemicals (-3,300), Paper and paper products (-1,800), Apparel (-1,600), Plastics and rubber products (-1,400), Leather and allied products (-1,200), Textile mills (-600), and Textile product mills (-300). However an increase in employment was registered in Food manufacturing (2,500), Beverages and tobacco products (700), and Petroleum and coal products (100).
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: August 2009, USDL 09-1067,” released September 4, 2009; next release is October 2, 2009)
http://www.bls.gov/news.release/pdf/empsit.pdf
In July 2009, manufacturing output was up 1.0 percent and was 14.4 percent below its year-earlier level.
The production index for durable goods was up 2.2 percent. The durable manufacturing industries that registered increased in output included Motor vehicles and parts (20.1 percent), Primary metal (3.3 percent), Nonmetallic mineral products (2.3 percent), Aerospace and miscellaneous transportation equipment (0.9 percent),Wood products (0.7 percent), Miscellaneous (0.7 percent), Computer and electronic products (0.6 percent), Furniture and related products (0.2 percent). The durable manufacturing industries that registered decreases in output included Electrical equip., appliances, and components (-0.8 percent), Machinery (-0.5 percent), Fabricated metal products (-0.3 percent).
The production of nondurable goods decreased 0.1 percent. Industries that registered increases included Plastics and rubber products (0.9 percent), Paper (0.6 percent), Chemical (0.4 percent), Apparel and leather (0.1 percent), and Textile and product mills (-1.6 percent). Industries that registered decreases included Printing and support (-1.3 percent), Petroleum and coal products (-0.5 percent), Food, beverage, and tobacco products (-0.4 percent).
The index for other manufacturing industries (non-NAICS) decreased 0.6 percent in July.
In July 2009, manufacturing industries (NAICS based) operated at 65.5 percent of capacity, 13.9 percentage points below their 1972-2008 average of 79.4 percent and 0.7 percentage points higher than their revised capacity utilization in June 2009.
In durable manufacturing, capacity utilization increased 1.8 percentage points in July from June (revised) to 59.1 percent. Increase capacity utilization was registered in Motor vehicles and parts (7.7 points),Primary metal (1.5 points),Nonmetallic mineral products (1.3 points),Aerospace and miscellaneous transportation equipment (0.7 point),Wood products (0.5 point), Furniture and related products (0.5 point),Miscellaneous (0.5 point), and Computer and electronic products (0.1 point). Decrease capacity utilization was registered in Electrical equip., appliances, and components (-0.5 point), Machinery (-0.2 point). Fabricated metal products remained unchanged.
Capacity utilization in non-durable manufacturing in July increased 0.1 percentage points from June (revised) to 72.5 percent. Increased capacity utilization was registered in Plastics and rubber products (0.8 points), Paper (0.5 points), Apparel and leather (0.4 points), and Chemical (0.3 points). Decreased capacity utilization was registered in Textile and product mills (-0.6 points), Printing and support (-0.5 points), Petroleum and coal products (-0.4 points), and Food, beverage, and tobacco products (-0.2 points).
Manufacturing sector productivity grew 4.9 percent in the second quarter of 2009, as output fell 9.8 percent and hours worked decreased 14.0 percent; declines in output and hours were much larger in durable goods industries than in nondurable goods industries. The productivity gain in the manufacturing sector was the largest since the first quarter of 2005.
In durable goods industries, productivity rose 3.1 percent in the second quarter of 2009, as output fell 16.4 percent and hours fell 18.9 percent.
In nondurable goods industries, productivity grew 2.2 percent in the second quarter, reflecting declines in output and hours of 3.2 percent and 5.3 percent, respectively.
(BLS/DOL Productivity data from “Productivity and Costs, USDL 09-0966 Second Quarter 2009, Revised,” released September 2, 2009; next release is November 5, 2009)
http://www.bls.gov/news.release/pdf/prod2.pdf
Year to date June 2009, U.S. manufactured goods exports accounted for 82.1 percent of all U.S. exports of goods, compared with 80.7 percent a year ago. Manufactured goods exports in June were 3.7 percent higher than previous month, while imports were also up 6.2 percent. Year to date June 2009’s trade deficit in manufactured goods of $138.3 billion was $79.8 billion less when compared with $218.1 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 July 2009, the Producer Price Index (PPI) for finished goods, except foods and energy, decreased by 0.1.
The index for finished energy goods was down 2.4 percent in July.
Decrease of price was registered in Home heating oil and distillates (11.9 percent), Gasoline price (10.2 percent), and No. 2 diesel fuel (8.0). However an increase of price was registered in liquefied petroleum gas (11.7 percent), Residential gas (3.3 percent), and Residential electric power (0.7 percent).
Institute for Supply Management's (ISM) Index updated
Economic activity in the manufacturing sector expanded in August, following 18 consecutive months of contraction, and the overall economy grew for the fourth consecutive month, say the nation's supply executives in the latest Manufacturing ISM Report On Business®.
The PMI registered 52.9 percent, which is 4 percentage points higher than the 48.9 percent reported in July. This is the highest reading since June 2007, when the index also registered 52.9 percent. 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 August were: New Orders up 9.6 points to 64.9, Production up 4.0 points to 61.9, Employment up 0.8 points to 46.4, Supplier Deliveries up 5.1 points to 57.1, and Inventories up 0.9 points to 34.4.
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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