December 2008 Edition
INDUSTRY NEWS
The growing number of underemployed workers is painting a
grim picture of the difficulties jobseekers are facing, according to the
Economic Policy Institute. Underemployment is a more comprehensive measure of
labor market slack than headline-grabbing unemployment rates because it also
includes part-time workers who want full-time jobs – involuntarily part-time
workers – and jobless workers who want a job but are not actively seeking
employment – marginally-attached workers.
At 11 percent, the underemployment rate in September was at
its highest in more than 14 years. The underemployed currently includes about
9.5 million unemployed workers, 6.1 million involuntarily part-time workers, and
1.6 million workers only marginally attached to the workforce. Data on the
number of unemployed and the number of involuntarily part-time workers are
seasonally adjusted. The U.S. Bureau of Labor Statistics does not release the
seasonally-adjusted number of marginally attached workers so the reported number
is not seasonally adjusted.
The fact that one out of every nine U.S. workers is now
either unemployed or underemployed is clear evidence of the need for a second
stimulus package targeted at job creation, according to the institute.
Boeing Commercial Airplanes, Chicago, and striking machinists
in Washington, Oregon, and Kansas voted to ratify a four-year contract that
includes wages and pension agreements. About 27,000 employees represented by the
International Association of Machinists and Aerospace Workers voted to end the
58-day strike.
The contract calls for general wage increases of 15 percent
during the next four years, an immediate 16 percent pension increase, and
lump-sum payments of at least $8,000 during the life of the agreement.
The contract is for four years, longer than Boeing previously
negotiated with the IAM.
In contrast to the financial news, an unprecedented number of
people attended the opening day of the 2008 FABTECH International & AWS Welding
Show. More than 12,000 manufacturing and welding professionals attended the
first day of the show in Las Vegas, with more than 21,000 visiting during the
three-day event.
Whether the attraction was the new technology or the new
location, statistics from the show support exhibitor claims of both high numbers
of sale leads and the quality of the leads. This was the first show west of the
Mississippi. It attracted, according to show data, 56 percent first-time
attendees, 32 percent from the West Coast, and 16 percent international
attendees. Stats show 83 percent of the attendees either make or influence the
purchasing decision.
In 2009 the show will be in Chicago and in Atlanta in 2010.
Following two years of reporting declines in the number of
new lawsuits and regulatory proceedings – including a drop in large-dollar cases
– U.S. companies now anticipate an uptick in new actions and government probes,
as well as the need to hire more in-house litigation staff to help manage the
expected rise in disputes, according to the 2008 Litigation Trends Survey
published by international law firm Fulbright & Jaworski L.L.P.
By several key indices, the overall pace of fresh litigation
trended downward in 2007-08, with 21 percent of U.S. companies reporting no new
lawsuits filed against them in the past year. That’s an improvement from the
17 percent having stayed litigation-free in 2006-07 and nearly double the number
from 2005-06, when 11 percent of companies reported enjoying a year without any
new lawsuits to defend.
There was also a noticeable drop in big-dollar filings. Only
26 percent of U.S. firms were tagged with one or more new lawsuits with claims
above $20 million in the year past, a decline of 14 percent from 2007.
While overall case filings may have slowed this year, the
litigation landscape is by no means shrinking. Findings show that most U.S.
companies still face litigation exposures, with certain industries prone to
particular types of actions – intellectual property/patent infringement, product
liability, environmental/toxic tort – even as almost all businesses contend with
disputes involving employment, contracts, and personal injury.
Companies also detect a spike in specific types of actions –
32 percent of Fulbright respondents reported a jump in multi-plaintiff suits
stemming from wage-and-hour claims by employees in the past year, with
29 percent notching an increase in discrimination cases, including age claims.
Companies also cited a noticeable rise in privacy lawsuits, whether class or
collective actions.
August U.S. manufacturing technology consumption totaled $323
million, according to The Association for Manufacturing Technology and the
American Machine Tool Distributors’ Association. This total, as reported by
companies participating in the United States Manufacturing Technology
Consumption – USMTC – program, was up four percent from July but down 11.5
percent from the total of $365.14 million reported for August 2007. With a
year-to-date total of $3 billion, 2008 is up 12.7 percent compared with 2007.
These numbers and all data in this report are based on the
totals of actual data reported by companies participating in the USMTC program.
The report, jointly compiled by the AMT and AMTDA,
representing the production and distribution of manufacturing technology,
provides regional and national U.S. consumption data of domestic and imported
machine tools and related equipment. Analysis of manufacturing technology
consumption provides a reliable leading economic indicator as manufacturing
industries invest in capital metalworking equipment to increase capacity and
improve productivity.
U.S. manufacturing technology consumption is also reported on
a regional basis for five geographic breakdowns of the United States.
Northeast Region
At $47.1 million, consumption was down 4.7 percent when
compared with July’s $49.41 million and down 8.3 percent when compared with
August a year ago. With a year-to-date total of $428 million, 2008 is off one
percent from the comparable figure in 2007.
Southern Region
Consumption stood at $31.34 million, down 23.5 percent when
compared with July’s $40.95 million, and 35.7 percent less than the August 2007
total. At $4.6 billion, the 2008 year-to-date total is 28.7 percent higher than
the comparable figure for 2007.
Midwest Region
Manufacturing technology consumption totaled $121.82 million,
47.3 percent more than July’s $82.71 million, and up 4.2 percent when compared
with the total for August a year ago. The $1 billion year-to-date total is up
30.2 percent when compared with 2007 at the same time.
Central Region
Consumption totaled $80.77 million, 21.4 percent less than
July’s $102.74 million and 19.8 percent less than the August total a year ago.
With a year-to-date total of $736.37 million, the 2008 tally is 2.7 percent
above the comparable figure for the previous year.
Western Region
Manufacturing technology consumption rose to $42.05 million,
20.7 percent higher than the $34.84 million total for July, but off 11.3 percent
when compared with last August. The $367.54 million year-to-date total is down
3.6 percent when compared with 2007 at the same time.
The Modern Applications News Industrial Average – MANIA – tracks 34 publicly-traded companies in the metalworking field and compares the companies’ monthly trend to the corresponding trend of the Dow-Jones Industrial Average
Armadillo Aerospace, Rockwall, TX, earned $350,000 in NASA
prize money during the Northrop Grumman Lunar Lander Challenge in Las Cruces,
NM.
The challenge is a two-level, $2 million competition designed
to accelerate commercial space technology and is sponsored by NASA’s Centennial
Challenges program. After Armadillo’s $350,000 first place win for Level One
this year, $1.65 million remains as available prize money for future
competitions.
Armadillo’s winning vehicle successfully demonstrated some of
the technologies needed for a lunar lander capable of ferrying payloads of
humans back and forth between lunar orbit and the lunar surface. During the
first day of competition at Las Cruces International Airport on Oct. 24, the
vehicle rose to a height of 50 meters, translated to a landing pad 100 meters
away while staying aloft for at least 90 seconds, landed safely, and later
repeated the flight.
Armadillo attempted to claim the $1 million first place prize
for Level 2 on Oct. 25, with a larger vehicle designed to stay aloft for twice
as long and land on simulated lunar terrain with craters and rocks, but it was
not successful.
The $350,000 prize won by Armadillo represents the largest
prize yet awarded under NASA’s Centennial Challenge program. The Armadillo team
will be recognized for their achievement at a ceremony in Washington.
Centennial Challenges is NASA’s prize program to promote
technical innovation through competitions open to all Americans. The Lunar
Lander Challenge is one of seven current competitions designed to tap the
nation’s ingenuity in support of NASA’s goals. The program is managed by NASA’s
Innovative Partnerships Program Office.
Lincoln Electric Holdings, Inc., Cleveland, reported a 39.1
percent increase in third quarter 2008 diluted earnings per share to $1.60 from
$1.15 per diluted share in 2007. Operating income increased 32.8 percent to
$89.8 million from $67.6 million in 2007 on a sales increase of 12.1 percent.
Net income for the third quarter increased 38.5 percent to $69.2 million from
$50.0 million in 2007. The 2008 third quarter effective tax rate was 25.5
percent compared with 28.7 percent in 2007.
Sales for the third quarter increased 12.1 percent to $632.9
million from $564.8 million in the comparable period of 2007. Sales for the
company’s North American operations were $370.5 million in the quarter versus
$346.7 million in the comparable quarter last year, an increase of 6.9 percent.
U.S. export sales in the quarter increased 23.5 percent to $62.5 million from
$50.6 million in 2007.
Sales at Lincoln subsidiaries outside North America increased to $262.4
million in the third quarter, compared with $218.1 million in the year ago
quarter, an increase of 20.3 percent. Excluding acquisitions and the effect of
changes in foreign currency exchange rates, sales outside North America
increased 6.9 percent in the quarter.
