Rep. Scalise, Sen. Capito introduce Legislation to Improve Air Permitting

Last week, Rep. Steve Scalise (R-LA) and Sen. Shelley Moore Capito (R-WV) introduced H.R. 2557/S. 1425, the “Promoting New Manufacturing Act,” in the House and Senate. The NAM has been a longtime supporter of this bill, on which we testified and supported with a Key Vote Letter in the 113th Congress.

The Promoting New Manufacturing Act would make a series of relatively simple enhancements to the air permitting process to enable manufacturers to get their permits quicker while allowing the EPA to continue to protect the environment. It would create a permitting dashboard, requiring EPA to publish information on the regarding the estimated number of permits issued annually and timelines for making final permit decisions; it would require that if the EPA Administrator establishes or revises a national ambient air quality standard (NAAQS), the agency publish implementing regulations and guidance at the same time, including information regarding the submittal and consideration of preconstruction permit applications; and it would require EPA to report annually to Congress on actions being undertaken by the agency to expedite the processing of permit applications. (continue reading…)

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Dallas Fed: Manufacturing Activity Contracted in Texas for the Fifth Straight Month

The Dallas Federal Reserve Bank said that manufacturing activity contracted in Texas for the fifth straight month. The composite index of general business conditions declined from -16.0 in April to -20.8 in May, falling to its lowest level since June 2009. Manufacturers in the district continue to struggle with lower crude oil prices; although, there might also be a sense of stabilization. As one fabricated metal manufacturing respondent said in the sample comments, “With some recovery in the price per barrel of oil, the general feeling is that our business has leveled.”

Still, these data suggest that demand and production remain very weak right now. The underlying data were mostly lower across-the-board, with declines in activity getting larger, at least for now. This included measures for new orders (down from -14.0 to -14.1), production (down from -4.7 to -13.5), shipments (down from -5.6 to -13.2), capacity utilization (down from -10.4 to -11.6), employment (down from 1.8 to -8.2) and hours worked (down from -5.0 to -11.6). Illustrating this point, 31.0 percent of survey respondents cited declining new orders for the month, with just 16.9 percent noting increases. On the other hand, capital expenditures (up from 3.3 to 3.4) continued to expand somewhat modestly, providing some degree of optimism moving forward. (continue reading…)

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Conference Board: Consumer Confidence Rebounded a Little in May

The Conference Board said that consumer sentiment rebounded a little in May. The Consumer Confidence Index has been quite volatile over the past six months, ranging from a low of 91.0 in November to a high of 103.8 in January (a post-recessionary peak).  Confidence plummeted to 94.3 in April, but it edged somewhat higher to 95.4 in May. On the positive side, Americans are more confident today than they were one year ago (when the index was 82.2), and they were slightly more upbeat for the month. Yet, these data indicate that the public remains anxious about employment and income growth, mirroring softer-than-desired economic data in the early months of this year. (continue reading…)

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Richmond Fed: Manufacturing Activity Expanded Ever-So-Slightly in May

The Richmond Federal Reserve Bank said that manufacturing activity expanded ever-so-slightly in May, an improvement after contracting in both March and April. The composite index of general business activity improved from -3 in April to 1 in May. The underlying data were also better, including new orders (up from -6 to 2) and capacity utilization (up from -4 to 7). Shipments (up from -6 to -1) continued to contract, but at a slower pace of decline for the month. At the same time, the labor market was mixed. The rate of employment growth (down from 7 to 3) eased somewhat, but the average workweek (up from 4 to 6) and wages (up from 9 to 20) were stronger. (continue reading…)

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Durable Goods Orders Fell 0.5 Percent in April, but Up Modestly Excluding Transportation

The Census Bureau said that new durable goods orders declined by 0.5 percent in April, pulling back from the 5.1 percent increase in March. Strong defense and nondefense aircraft orders in March helped to buoy that month’s figures, with April’s data reflecting a slight pullback from those levels. Aircraft sales are often bulked together in batches, making them more volatile from month-to-month. As a whole, transportation equipment orders fell 2.5 percent, largely on the decreases for aircraft. Motor vehicles and parts sales, which are also part of transportation orders, rose 0.3 percent in April, edging a bit higher after growing by 4.2 percent in March.

Excluding transportation, new durable goods orders were up 0.5 percent in April. It was the second straight monthly increase, building off of the 0.6 percent gain observed in March. That provides a degree of comfort, and yet, we have seen softness in this measure over much of the past year. New durable goods orders excluding transportation measured $157.7 billion in April, down 0.9 percent year-over-year from $159.1 billion in April 2014. Indeed, this broader measure has fallen from $164.3 billion in September, its peak of 2014. (continue reading…)

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Monday Economic Report – May 26, 2015

Here is the summary for this week’s Monday Economic Report:

The minutes of the April 28–29 Federal Open Market Committee (FOMC) meeting highlighted the nuance that many of us see in the economy right now. The Federal Reserve highlighted a number of challenges facing consumers and businesses in the early months of 2015, noting how these headwinds have dampened overall activity year-to-date. On the other hand, the FOMC felt that slowing economic growth was largely due to “transitory factors,” with its outlook mostly unchanged for the rest of this year. The Federal Reserve projects growth of 2.3 to 2.7 percent in 2015, and it expects the unemployment rate to fall to 5.0 to 5.2 percent.   (continue reading…)

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Transportation Can’t Wait!

Today, the Senate voted to pass H.R. 2353, the Highway and Transportation Funding Act of 2015. The House passed the measure earlier this week in a 387-13 vote. The NAM sent Key Vote letters to the House and Senate this week in support of the short-term measure that will keep federal highway and transit projects around the nation funded until July 31.

H.R. 2353 is not the solution that manufacturers envisioned when the 114th Congress commenced in January 2015.  This legislation is yet another temporary fix to a problem that has grown in size and scope over the years. Dealing with long-term transportation funding at a later date is not leadership.

With deteriorating roads and bridges, aging transit systems and growing maintenance backlogs across the states, Congress is telling manufacturers, businesses and the American people that transportation can wait.

Transportation can’t wait. Several small and large manufacturers took time away from their shop floors last week and came to Washington to keep making the case for transportation infrastructure before Members of Congress and at the White House.

NAM Member Scott Stevens, President of Dimension Fabricators in Schenectady, New York fabricates reinforced steel. He came to Washington last week from New York to articulate the importance of a well-funded, multi-year highway bill and explain the real-world impacts when states pull back infrastructure funding due to the long-term uncertainty of a federal transportation authorization. Scott was joined by NAM Member Stephen Roy, President of Mack Trucks in Greensboro, NC, a subsidiary of the Volvo Group. Scott Stevens has several Mack Trucks in his fleet and when he does well and grows, he buys more Mack Trucks.  Scott and Stephen also met NAM Member Ron Dickerson, a Vice President and General Manager at Nucor Steel Indiana in Crawfordsville, IN. Dimension Fabricators and Mack are also Nucor customers. The customer and supplier relationship unfolded during meetings on the Hill and this what happens when manufacturers tell a powerful story.

While assurances have been made that the surface transportation authorization is critically important in this Congress, this week’s transportation vote was not a win for manufacturers. It’s simply another day to keep things moving and avoids the embarrassing spectacle of a shutdown.

For NAM Member Astec Industries whose President and CEO Ben Brock also traveled to Washington last week, the temporary move is yet another disappointment and represents the frustration manufacturers feel about Washington. Over the past few weeks, Astec has worked to mobilize its employees and the communities where it manufactures and it will continue efforts.

Manufacturers can’t wait. Congress must act.

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Small Business Manufacturers Testify on Benefits of Trade

Manufacturers celebrated this week the annual “World Trade Week,” reaffirming the importance of trade to economic opportunities and job growth. The House Small Business Committee highlighted the impact of trade on small businesses with a hearing on Wednesday. NAM Board member and Power Curbers, Inc. President and CEO Dyke Messinger testified on the hearing panel, pressing for congressional passage of Trade Promotion Authority (TPA) and a long-term reauthorization of the Ex-Im Bank to help level the playing field for manufacturers in the United States. (continue reading…)

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Consumer Prices Rose 0.1 Percent in April

The Bureau of Labor Statistics said that consumer prices rose 0.1 percent in April, slightly lower than the 0.2 percent gains observed in both February and March. Lower energy prices helped to reduce the pace of the headline number, with energy costs down 1.3 percent for the month. Gasoline prices declined 1.9 percent in April, easing a bit after 2.4 percent and 3.9 percent increases observed in February and March, respectively. On a year-over-year basis, gasoline sells for 31.7 percent less today than in April 2014. Note that the average price of gasoline has risen a little since then, with the Energy Information Administration reporting that the average price of regular gasoline was $2.604 per gallon on May 18, up from $2.315 on April 6. This is still more than one dollar lower than seen 12 months ago. (continue reading…)

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This Could Be the Year!

Every sports fan begins their team’s season thinking, “this could be the year” and hopes for the stars to align so that they can watch their favorite team in the title game.

In the tax policy world, we continue to hope that this is the year where Congress will pass, and the Administration will sign into law, comprehensive tax reform. However, just as athletes know you cannot forget about the fundamentals, as Congress continues to work towards comprehensive tax reform, they need to also ensure that the basics of sound tax policy are in place for our economy to grow. To that end, manufacturers across the country applaud the introduction today of H.R. 2510 by Rep. Pat Tiberi (R-OH) that would make permanent 50% first year expensing, aka “bonus depreciation” along with a complimentary provision which allows companies with AMT credits to accelerate the use of these credits in lieu of bonus depreciation. (continue reading…)

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