Manufacturing
The president has touted the resurgence of manufacturing in America in two SOTU speeches. He has stated among other things that our manufacturing sector is adding jobs, 620,000 new manufacturing jobs over the last four years, for the first time since the 1990s. This resurgence is fueled by abundant natural gas production, which the President stated in a trip to the Marcellus Shale region outside Pittsburgh on January 30th. At this event, President Obama and US Steel CEO Mario Langhi provided some much-needed context into how the steel manufactured there is used in our daily lives. More specifically, the steel made at this facility is being used to manufacture pipelines needed to bring natural gas to our homes. And while the steel industry manufactures and provides pipelines, the natural gas industry has supplied steel plants with cheap natural gas, which keeps production costs down. Interesting that the President takes credit for increased manufacturing that largely comes from natural gas derived from fracking which he and his supporters abhor via pipelines that he does not approve. He says his administration has launched two hubs for high-tech manufacturing. One is in Youngstown, Ohio and is focused on 3-D printing and one focused on energy-efficient electronics in Raleigh, North Carolina. He has announced the next two advanced manufacturing hubs. One is in the Detroit area, and the other is in Chicago, Illinois. All these hubs are partnerships that bring together companies and universities to develop cutting-edge technology, train workers to use that technology, and then make sure that the research is translated into real-world products made by American workers. Sound good? Well it is supposed to sound good. But doe sit make a difference or just spend money? We will have to wait and see.
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Economic Growth Sluggish in 2015

5/31/15
from NCPA,
5/29/15:

Last month the Bureau of Economic Analysis (BEA) released its first estimate of the growth in real Gross Domestic Product (GDP) during the first quarter of 2015. According to the report, real GDP's annualized growth rate was only 0.2 percent. Some argue that this low estimate is due to an underlying methodological issue that results in a significant underestimate for the first quarter. However, several economic indicators have decelerated or declined over the last few months, indicating tepid growth in the first quarter. What exactly is the debate over the recent GDP report? At issue are the BEA's seasonal adjusting methods. Most economic raw estimate features significant variation throughout the year due to typical changes in weather and holidays. In order to uncover those trends throughout the year, officials publish seasonally adjusted estimates, which account for these variations and generally are the headline figures in any report. Economists have noted that even after seasonal adjustment, the BEA's first quarter GDP growth estimates have been consistently lower than the rest of the year. This might suggest that the BEA has been underestimating first quarter growth. Economists have found some troubling signs of slow growth: - Total retail sales began to fall at the end of 2014 and continued to decline in 2015. - There was a decline in consumer confidence during the beginning of 2015. - Durable goods orders excluding defense and aircraft have been falling since summer 2014 and continued to decline into 2015.

- ISM's composite index of manufacturing growth, the PMI, has fallen significantly since last summer and continued to fall through the first quarter of 2015, representing a significant deceleration in manufacturing growth. - Non-manufacturing was still growing at a decelerated rate at the beginning of 2015.

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