Category : Uncategorized

Washington, Feb. 14,
2020

Washington is ready to slap tariffs on countries that
weaken their currency to obtain an unfair cost advantage. A new rule from
the Commerce Dept. allows U.S. companies to file complaints about imported
goods from countries that manipulate the values of their currencies. If the
feds agree with the charge, they will impose countervailing duties on the
offending country’s imports.

And the policy faces potential legal challenges. Critics say it is ripe for abuse and may also run afoul of World Trade Org. rules. But it continues the trend of cracking down on unfair trade practices that has been a White House priority.

Mergers and acquisitions are going strong, following a bumper year for dealmaking in 2019. Companies are optimistic about the economy and willing to lay out large sums to increase their geographic and market reach. M&A has been particularly brisk in tech and health care. 2019 saw a 23% boost in deals worth $5 billion or more, mostly in those two sectors. Expect more in 2020.

1. Rhode Island General Laws Title 44 Taxation 44-3-3 Property exempt.   Manufacturers are exempt from property tax as noted in 44-3-3.  The Town of Cumberland’s tax assessor has decided to tax a manufacturer because he notes that the equipment is on a lease.  RIMA has taken action by submitting new verbiage in the State Statue that our CPA firm and RISCPA tax head feels will rectify this concern going forward.

2. TCI RIMA will be opposing this tax increase in our gas prices.  This is no more than an end around on the carbon tax.  The impact on the cost to our members and their employee’s will be costly.  In addition, we have been informed that this will produce an additional emissions reduction of 1-6 percentage points on top of a presumed reduction of 19%.  TCI would extract $56 billion from motor fuel users to reduce carbon dioxide emissions by a little more than 5% over 10 years.

3. RiteShare:  Offensive over the top burden to business.  The system is not computerized.  The data/information requirements are a time consuming matter and burden to companies who do not have HR departments.  RIMA has put together a point by point issues on this proposal.  The penalty fees for a 52 person company is the same for a 1000 person company.  RIMA will be discussing with the Administration but is currently opposed to this program

4. 7% IT Tax:  RIMA is not in favor of this as the business community continually is being hit with tax revenue ideas.  This tax or cost will be passed on to our businesses and private sector.

5. Tangible Tax/Commerce:  RIMA did a survey for Commerce and found that a reduction to 2.5% would vary from a savings of $200.00 small manufacturer to $30,000 for a larger manufacturer. The structure of this program needs to be further discussed and seems un-attainable in light of the very tight budget presented this year.

6. Real Jobs: RIMA will be supporting the funding of the program. It has been a major help to finding new employee’s but also a pipeline for hiring individuals to prepare for retiring CNC operators/setup personnel.  RIMA did a survey of it’s members and found that on average each company had 33% of their work force at age 55+.

7. Davies Vocational:  $500,000 in budget for engineering design for potential renovation.  A future bond for a revamping of the schools is possible in the future. The Governor has indicated that she would put in $4.5million next year for the project.

8. Minimum Wage Legislation:  RIMA expressed concerns on the increase but asked that the increase be reviewed on an annual basis and not tied to automatic increases each year.  RIMA also asked that the implementation date be noted as of 01/01/2021. The implementation date was not adjusted for the first time.  The past seven increases were all calculated to stated as of a 01/01 date.

9. Polaris:  RIMA is in support of increased funding for Polaris. RIMA and Polaris have partnered successfully over the last two years to bring various programs and support to the manufacturing community.

10. RIMA continues to level the playing field on various programs that only C-corps can participate in.  The majority of manufacturers in Rhode Island are either S-corps or LLC’s.  We therefore have respectfully requested that those statues that limit our S-corps and LLC’s be changed to include the pass through corporations as well.

11. RIMA, CCRI and Dept. of Corrections have embarked on a manufacturing training program.  The intent is to achieve success of training 10-15 inmates to learn the basics of CNC-machining.  We would advise these inmates on the advantages of learning this trade, the benefits available, the pay scale and the pride of making precision components.  The Governor has submitted $250,000 dollars in her budget to start the first of what we hope to be many classes.  The success of this program will also drive other potential training programs such as Quality Control, Shipping/Receiving training, Customer service and other ideas in the works.

12. RIMA continues to offer their “Travelling Manufacturing Road Show” to all 39 cities and towns.  We would co-ordinate a program to address the many programs offered by Commerce-RI, Dept. of Labor and Training, Governor’s Workforce Board, Dept. of Business Regulations and Polaris.  It is our intent to educate our manufacturers in all 39 cities and towns of what is available to help them run their operations.

U.S. JOB OPENINGS declined
561,000 to 6.8 million in November. / BLOOMBERG NEWS FILE PHOTO/MIKE FUENTES

WASHINGTON – United States
job openings fell in November to the lowest level in almost two years,
indicating more employers see headcounts sufficient enough to meet demand.

The number of positions
waiting to be filled decreased by 561,000 to 6.8 million, the lowest since
February 2018, according to the Labor Department’s Job Openings and Labor
Turnover Survey, or JOLTS, released Friday. Openings have steadily declined
since a 2018 peak of 7.63 million.

The recent drop in open positions is consistent with moderation in both the job market and the economy. Nonetheless, openings continue to exceed the number of unemployed as the tight labor market makes it difficult to find experienced workers. Labor shortages are also evident in lower-wage industries, which has prompted employers to offer higher pay.

Total vacancies exceeded the number of unemployed by just under 1 million in November, the report showed.

A gauge of United States
manufacturing rebounded sharply in January, topping estimates and signaling
growth in the beleaguered sector for the first time since July.

The Institute for Supply
Management’s purchasing managers’ index, based on a survey of manufacturers,
increased to 50.9 in January from an almost four-year low of 47.8, according to
Monday’s data. While just above the 50 level that signals expansion, the
monthly advance was the largest since mid-2013. ISM last week revised data back
to 2012. Stocks, bond yields and the dollar extended gains after the report.

The gain – exceeding the median
projection for 48.5 – reflected sizable improvements in the orders and
production components, while the employment gauge contracted at a slower pace.
The new orders index jumped to an eight-month high of 52 and the production
gauge surged 9.5 points, also the largest gain in more than six years.

The J.P. Morgan Global Manufacturing PMI expanded for the second straight month, albeit only marginally, at 50.1 in December. More importantly, it sustained progress in the sector following six consecutive months of contraction.

Half of the top 12 markets for U.S.-manufactured goods contracted in December, down from seven in November. However, nine of these markets had lower PMI readings in December than in November. As a result, while global manufacturing activity has stabilized somewhat in the past few months, the sector remains weaker than desired.

Manufacturing employment fell by 12,000 workers in December, dropping for the second time in the past three months. In 2019, manufacturers added roughly 3,800 workers per month on average, compared to the average of 22,000 manufacturing workers created each month in 2018.

While the manufacturing sector has steadied somewhat recently, it remains weaker than desired as firms continue to grapple with slowing global growth and trade uncertainties. Eleven of the 19 major manufacturing sectors experienced reduced hiring in December. Average hourly earnings for production and nonsupervisory workers in manufacturing rose 2.8% year-over-year.

How the tariffs are set to
change:

“In exchange for China’s purchasing commitments, the Trump administration will cancel new tariffs on roughly $156 billion in Chinese imports that were set to take effect Dec. 15.”

“It has also agreed to cut in half the existing 15% tariff rate on roughly $120 billion of Chinese goods that had been imposed on Sept. 1. But tariffs will remain on roughly $360 billion of annual Chinese imports to the U.S., a majority of the Chinese goods sold in America.”

NAM President and CEO Jay
Timmons appeared on CNBC early this morning to talk about the deal. He said:

“Manufacturers are extraordinarily pleased that we have been able to complete phase one [of the trade deal] . . . The good news for manufacturers is there’s a key priority that has been addressed and that is enforceable rules regarding intellectual property theft and holding China accountable.”

“We are very pleased about that; we are looking forward to phase two because there are a lot of other issues that still have to be addressed.”

The U.S. economy grew 2.1%
at the annual rate in the fourth quarter. Global headwinds and trade
uncertainties continued to have large impacts on the underlying data, with
businesses hesitant to invest in their firms and sizable declines in exports
and imports, especially the latter.

New durable goods orders rose 2.4% in December, bouncing back after falling 3.1% in November. With that said, the latest figures are boosted by very strong defense aircraft and parts orders. Excluding transportation equipment, new orders edged down by 0.1%.

New durable goods orders have fallen 3.7% over the past 12 months, with a decline of 1.0% with transportation equipment excluded. As such, durable goods manufacturers ended the year on another disappointing note. Core capital goods spending-a proxy for capital spending in the U.S. economy-decreased 0.9% in December, but on a year-over-year basis, this figure increased 0.9%.

Private manufacturing wages and salaries rose 0.7% in the fourth quarter, up from 0.6% in the third quarter. That translated into 3.2% growth over the past 12 months, the fastest year-over-year pace of growth since the first quarter of 2002, or in nearly 18 years.

Manufacturing production rose 0.2% in December, but, overall, the data continued to reflect weaknesses for the sector in 2019. Over the past 12 months, output has declined 1.3%, with year-over-year growth negative for six straight months to end the year. Looking at annual averages, manufacturing production declined 0.2% in 2019, pulling back from the 2.3% gain seen in 2018.

There have been some signs of stabilization in other data points, especially in global markets and considering recent trade developments. My forecast for manufacturing production growth in 2020 is 0.5%. Along those lines, surveys from the New York and Philadelphia Federal Reserve Banks found expanding activity in January, beginning the year on a positive note.

Total industrial production declined 0.3% in December. Utilities output fell 5.6%, largely because there was less spent on heating costs due to warmer temperatures, pulling the headline measure lower. Overall, industrial production fell 1.0% over the past 12 months, declining on a year-over-year basis for the fourth straight month.

Job openings in the manufacturing sector fell to just 388,000 in November, the slowest pace since December 2017. Nonetheless, manufacturing job postings remained elevated over much of 2019, averaging more than 472,000 per month year to date, including the all-time high reached in June (515,000). The overall labor market remains solid, even with softer net hiring, with job openings continuing to outpace unemployment by nearly one million.

With the new Congressional session in full swing, Congressman Langevin has returned to Washington and remains focused on working for the people. While he is eager to continue advocating for Rhode Island’s Second Congressional District, I want to share some of our accomplishments from 2019.

Last year, the House of Representatives considered and passed important legislation to cut high health care costs, raise wages, protect our elections, and more.  As a part of these efforts, Congressman Langevin authored 27 bills and amendments and cosponsored 276 pieces of legislation.

Important work was done on the ground in Rhode Island as well. Our Constituent Service Representatives resolved problems for 637 constituents, helping address a wide range of matters from Social Security to veterans affairs. The office also helped procure over $2 million in benefits and savings for Rhode Islanders in need and helped secure over $526 million in federal grants for the District.

Lastly, to hear directly from Rhode Islanders about the most pressing issues and how to help, Congressman Langevin participated in 215 public events, including four as part of the “Lunch with Langevin” series. Further, we continued to engage 440 community leaders like you across eight advisory committees.

Our work is far from over, but we have much to be proud of. We’ve entered the new decade ready to help in any way that we can.

Also published on the Providence Journal

The biggest challenge Rhode Island companies face is finding skilled workers to hire. We’d know–together, we represent some of the biggest industries in our state and employ more than 40,000 Rhode  Islanders. And while our companies and business models are very different, we’ve shared an experience for the last few decades: in times of both high and low unemployment, through economic booms and recessions, we have struggled to fill open positions that require specialized skillsets.

Fifty years ago, people could graduate from high school, immediately enter the workforce and earn a family-supporting income. But our economy has changed. Today, many companies–including our own–offer exciting, good-paying jobs with paths for career growth, but they demand particular skills beyond what students learn in high school or even in some college programs.

Rhode Island has a long history of experimenting with job training programs as a way to bridge that divide. Before Governor Raimondo created Real Jobs Rhode Island in 2015, few achieved any significant measure of success. Before Real Jobs RI, state leaders created and ran job training programs in a silo, without assessing the specific needs of the business community or the state of our workforce. People were given training that didn’t match up with what employers were actually looking for and struggled to find good-paying jobs in their new field. Rhode Island stayed stuck.

Real Jobs RI changed that. Under the Real Jobs RI model, business is brought in not only as a partner, but as an active participant in the program. Curriculum isn’t developed by some government official who’s never worked in the field, it’s being created by actual Rhode Island employers looking to fill vacant positions at their companies.

To date, more than 6,000 Rhode Islanders have gone through Real Jobs RI. The program’s track record is impressive: more than 80% of trainees are offered jobs immediately after completion. The Manufacturing sector relies strongly on Real Jobs.  Real jobs provides the basics and allows our businesses to then train them to their specific needs.

Every Real Jobs RI program is different, which makes sense: careers in advanced manufacturing, defense and health care require different skills. And it’s not just our industries that are represented. Real Jobs RI supports sectors driving our state’s economy with programs in health care, construction, defense, tech, design, manufacturing and countless others [will play with this depending on who the eventual companies are].

For businesses like ours, Real Jobs RI is revolutionary. The program allows us to hire new workers, retrain and promote current employees, and double down on our commitment to doing business in this state we love.

As two of the more than 1,000 employers served by Real Jobs, we ask the Governor and General Assembly for increased funding in this year’s budget. It’s rare for a program to benefit workers, employers and the state at the same time. But Real Jobs RI really does. Every dollar gives Rhode Island workers the opportunity to start or further an exciting career. Every dollar gives businesses like ours the skilled workforce we desperately need to grow. Simply put, Real Jobs RI is a win-win.

Real Jobs RI is one of the most innovative and successful job training programs in the country. Let’s ensure its future by expanding investments today.

At Vertikal6, we’re helping our clients use their real-time data in the mainstream of everyday business, not just during yearly planning sessions or monthly reviews. From real-time dashboards to data visualization to advanced analytics, Microsoft Power BI makes these capabilities possible for organization of any size.

California is preparing to implement its Consumer Privacy Act (CCPA), a data privacy law that is among the strictest in the country. The landmark law requires certain for-profit businesses abide by rules and restrictions regarding the consumer data they collect. With the law going into effect in 2020, businesses need to ensure that they are in compliance with these new data privacy regulations.