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Manufacturing Wages Significantly Higher

on Monday, 26 January 2015 10:17.

Madison, WI  (Food Manufacturing, January 23, 2015):  The average manufacturing worker made nearly 11 percent more than a comparable worker outside the manufacturing sector in 2012 and 2013, according to a newly released report.

In the analysis from D.C.-based liberal think tank the Economic Policy Institute, author Robert E. Scott tabs the wage premium for manufacturing jobs at $1.78 per hour, calling the industry "a particularly important provider of jobs with good wages for workers without a college degree."

The Alliance for American Manufacturing said that rate amounts to more than $3,700 on an annual basis for manufacturing jobs.

"This report makes clear just how crucial the manufacturing sector is to the nation's economy," said AMA President Scott Paul. "Manufacturing's wage premium is a clear path to the middle class."

In the wake of this week's State of the Union Address, the issue of stagnant middle-class wages has become a prominent focus in Washington. President Obama called on members of Congress to increase the minimum wage nationwide, giving "millions of the hardest-working people in America a raise;" 21 states, meanwhile, increased their own minimum wages as of Jan. 1.


Why U.S. Inflation Stays Low

on Friday, 16 January 2015 09:22.

Madison, WI (, January 12, 2015):  This isn't explained in Econ 101.

Month after month, U.S. hiring keeps rising, and unemployment keeps falling. Eventually, pay and inflation are supposed to start surging in response.

They're not happening.

Last month, employers added a healthy 252,000 jobs — ending the best year of hiring since 1999 — and the unemployment rate sank to 5.6 percent from 5.8 percent. Yet inflation isn't managing to reach even the Federal Reserve's 2 percent target rate. And paychecks are barely budging. In December, average hourly pay actually fell.

Economists are struggling to explain the phenomenon.

"I can't find a plausible empirical or theoretical explanation for why hourly wages would drop when for nine months we've been adding jobs at a robust pace," said Patrick O'Keefe, chief economist at consulting firm CohnReznick.


U.S. Job Openings Jump To 14 Year High

on Thursday, 15 January 2015 09:21.

Madison, WI (, January 13, 2015):  The rapid hiring that made 2014 a stellar year for job gains is showing no sign of slowing down.

U.S. employers advertised the most job openings in nearly 14 years in November, the Labor Department said Tuesday. That suggests businesses are determined to keep adding staff because they are confident strong economic growth will create more demand for their goods and services.

Job openings rose 2.9 percent to 4.97 million in November, the most since January 2001. More job vacancies generally lead to more hiring. Employers have been slow to fill their openings for most of the recovery, but that started to change last year as companies ramped up their overall hiring.

A second report Tuesday from the National Federation of Independent Business, a small business group, added to the positive outlook. An NFIB monthly index of small business optimism rose in December to its highest level since October 2006. Business owners surveyed by the group were also more likely to add jobs than at any point since the recession ended in June 2009.

"There's no question that small business owners are feeling better about the economy," NFIB chief economist Bill Dunkelberg said. "If they continue to feel that way 2015 could be a very good year."


The Future Of Big Data

on Tuesday, 13 January 2015 12:05.

Madison, WI (, January 9, 2015):  The big unifying theme of this year's International Consumer Electronics Show (CES) in Las Vegas has been the Internet of Things (IoT). From BMW's self-driving car to Quirky's and GE's connected light bulbs, smart door locks and bells, and Wi-Fi tea pots, there were hundreds of exhibitors who presented their IoT-ready technology.

The IoT is ultimately about connecting devices to people, and allowing them to remotely control and monitor their thermostats, lighting, air conditioners and other appliances.

But there's another, arguably deeper change taking place: the Industrial Internet. It's less about remote control and more about machine intelligence and allowing things like wind turbines, locomotives and jet engines to talk and understand each other. This dialogue will allow these "brilliant machines" to work better together, optimize production and reduce unplanned downtime.

GE has been developing Industrial Internet software and applications for several years, and spent more that $1 billion to launch its global software center in San Ramon, Calif.

Last fall, GE opened Predix, its software platform for the Industrial Internet, to outside developers like Japan's SoftBank Telecom, which took the first license in December.


US Employment Changes Since 2004

on Tuesday, 13 January 2015 12:01.

Madison, WI (Food Manufacturing, January 9, 2015):  U.S. employers added more than 5.2 million jobs over the past two years — a solid average of roughly 220,000 a month.

After 5½ years of recovery, the economy has recovered all the 8.7 million jobs that vanished during the Great Recession — and created an additional 2 million. The unemployment rate hit 5.6 percent in December, its lowest level since June 2008.

Economists expect the momentum to continue in 2015. Goldman Sachs estimates that thanks to lower energy prices, extra spending by consumers will lead to 300,000 more jobs this year than if oil prices had remained at their levels of six months ago.

Here are the job gains or losses in each of the past 10 years, along with the average monthly changes:

Job growth                 Annual                   Monthly average

2014                         2,952,000               246,000

2013                         2,331,000               194,250

2012                         2,236,000               186,333

2011                         2,083,000               173,583

2010                         1,058,000                 88,167

2009                        -5,087,000              -423,917

2008                        -3,576,000              -298,000

2007                         1,140,000                 95,000

2006                         2,085,000               173,750

2005                         2,506,000               208,833


Manufacturing Job Growth Up In 2014

on Monday, 12 January 2015 11:55.

Madison, WI (Food Manufacturing, January 9, 2015):  Manufacturing job growth increased dramatically in 2014 compared to the previous year, according to numbers from the federal Labor Department released Friday.

The report from the Bureau of Labor Statistics showed the manufacturing sector added an average of 16,000 jobs per month last year, compared to gains of 7,000 jobs per month for 2013.

The country saw an increase of 17,000 manufacturing jobs for December alone, according to the BLS monthly report.

The report comes on the heels of President Obama's visit to Michigan this week as his administration touted more than 764,000 manufacturing jobs gained since the end of the recession.

"Since 2010, we, America, have put more people back to work than Europe, Japan, and every other advanced economy combined — combined," Obama said at a Ford plant outside Detroit. "And let me tell you what's leading the way: American manufacturing."

The Alliance for American Manufacturing, however, pointed out December's manufacturing job gains were behind the pr


2014: A Much Better Year For Job Seekers

on Wednesday, 31 December 2014 10:18.

Philadelphia, PA (Drexel News Blog, December 18, 2014):  As 2014 comes to a close and we engage in holiday celebrations with a sense of renewal that typically comes with the beginning of a new year, the labor market offers one more reason for some optimism. Job seekers are in much better shape this year as firms step up hiring and the monthly number of job vacancies (unfilled jobs) has increased sharply over the year. Employers across the nation reported more than 4.8 million unfilled jobs on the last business day of October, up from 4 million a year ago, as payroll employment continued to rise, adding an average of more than 220,000 jobs per month over the year. This surge in the demand for labor has resulted in the number unemployed persons falling from 11.1 million to 9 million over the last 12 months.

Declining unemployment and rising job vacancies means that labor markets are tightening up and that job prospects have improved for many labor market participants. One way economists measure the strength of labor demand is with the ratio of unemployed workers to unfilled jobs. Known as the Beveridge measure, this ratio suggests that an economy achieves full employment when the number of unemployed workers is about equal to the number of vacant jobs. 'Beveridge full employment' occurs when the level of aggregate economic activity is sufficient to put active job seekers to work. Any remaining unemployment in a Beveridge full-employment economy (which can be considerable) is not the result of inadequate demand for labor, but is instead the result of any of a number of inefficiencies in the labor market that pose barriers to work for job seekers and barriers to hiring for employers.

The last time the U.S. met this full employment criterion was back in 2000, at the tail end of the Clinton boom, when job growth was strong, real wages were rising and many occupations and regions were characterized by labor shortage conditions. At that time, the number of unemployed persons was about the same as the number of unfilled (or vacant) jobs—achieving the Beveridge definition of a full-employment economy. The bust of 2001 took care of labor shortage problems in short order. Large-scale job losses reduced hiring and rising unemployment caused the U/V ratio to increase to nearly three unemployed workers per vacant job, by the middle of 2003. This meant that the level of labor demand was insufficient to absorb about two-thirds of all unemployed job seekers and that the economy needed a boost.

Over the next few years (2003 to 2007), the Bush economic expansion continued, accompanied by a more robust job growth, driving down unemployment and causing a considerable expansion in the number of unfilled jobs. By the middle of 2006, labor markets had tightened considerably and the overall U/V ratio had declined to around 1.6 unemployed workers per vacant job. Evidence of spot labor shortages emerged in health services, information (technology) and the finance industry as demand for workers with college degrees, relevant to firms in those sectors, grew rapidly. But once again, economic recession mitigated any threats of a lasting labor shortage problem—this time on a historically large scale.

The Great Recession that began in earnest with the Lehman Brothers collapse in September 2008 saw an explosion in the size of the U/V ratio as the nation's employers, plagued by staggering revenue and wealth losses moved to reduce expenses through hiring freezes, lay-offs, reduced hours of work and wage rollbacks. One of the most important consequences of these adjustments was that by the third quarter of 2009 a massive problem of excess labor supply emerged as 15.3 million unemployed workers sought just under 2.4 million vacant jobs, yielding an unemployed workers to vacant jobs ratio of about 6.5 (representing 6.5 officially unemployed workers per vacant job) and signaling a massive problem of excess labor supply as the labor market experienced precipitous declines in payroll employment, massive dislocation of experienced workers and a stinging rise in unemployment durations as more job seekers competed for fewer job vacancies.


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