Those of you who know me well, also know that I track manufacturing activity as a leading indicator of economic direction. The Institute for Supply Management® reports a monthly Purchasing Managers Index. Roughly speaking, anything above 50% indicates economic growth. Anything below, economic contraction.
What is it telling us about where we are right now? Economic activity in the manufacturing sector grew in June, with the overall economy notching a 13th consecutive month of growth, after the sharp contraction in April 2020. As of June, the national Manufacturing PMI® is at 60.6%. Down slightly from May, largely due to supply chain instability, this is still very strong. New orders, production, and backlog all are growing. Indeed, manufacturers are struggling to meet the demand. They are seeing record-long raw material lead times, higher commodities pricing, and difficulties with transportation. Indeed, recovery was showing its face in these numbers as early as early as July of 2020.
This may seem like an odd measure to track, and yet – I’ve been watching it since before the Great Recession of 2007-2009. At that time I was spending a lot of time with manufacturers, and they told me a downturn was coming – long before the rest of us saw it. They said, “orders simply dried up in mid-2007.” Most of us “felt” the Recession in early 2008, though the economists who measure such things indicate it began in late 2007.
What does the PMI tell us about recovery after the pandemic? Full speed ahead. In April of 2020, U.S. manufacturing measured the sharpest contraction since the Great Recession, with a PMI of 41.5%. By June of 2020, however, manufacturing activity had regained its momentum and it’s been increasing steadily ever since. This trajectory supports what many have felt about the pandemic: the economic fundamentals were strong; we were just…. stopped. The sense has been that, once the stoppage was, uh, stopped, demand would come roaring back.
Should you want to be “in the know,” you can read the ISM’s regular reports here.
A pause for those of us who know or were blessed by William Faulkner. He passed on July 3, at the age of 94. A WWII US Navy veteran, he served the Minnesota business community for more than 50 years. He also was a St. Paul Area Chamber Board Chair in 1984, and served on several nonprofit boards. In his own words, “it was all for the family.” We are better for him.
And finally: your Chamber is so honored to be among a strong field of finalists for Chamber of the Year, recognized nationally by the Association of Chamber of Commerce Executives (ACCE). Winners in each of the 4 categories will be announced on July 20. We’ll be sure to keep you posted!
See you in the trenches.
Minnesota to reduce COVID-19 vaccination sites after 70% goal reached.
Fauci: Too soon to say if Americans may need vaccine booster. So, maybe – but not yet.
Investigations into the origins of the COVID-19 pandemic are ongoing, but Avril Haines, director of national intelligence, said we may never know the true answer.
Rising cost of materials means fewer contracts, smaller profits for builders, says Federal Reserve survey conducted in late May.
Gas prices are projected to increase up to 20 cents over the summer, according to the American Automobile Association (AAA). This is in part due to the lack of consensus from OPEC and its allies about oil production levels – and pushed by robust – and growing - demand.
Regional economic conditions: Professional Services Sector: Attend a free webinar on Wed, Jul 14, 9-9:30am, with the Mpls Fed’s Joe Mahon to discuss the latest results from a June survey of services firms.
July’s U.S. Economic Outlook: Waiting for Liftoff. After a sluggish May, the U.S. economy laid the foundation in June for liftoff later this year. Americans are slowly going back to work and returning to look for work, but the rapid jobs recovery many economists expected remains elusive.
Federal Reserve Chairman Jerome Powell will testify at the House Financial Services Committee on Wednesday and the Senate Banking Committee on Thursday. Why is this worth watching? The largest U.S. banks will report earnings next week. Chair Powell is getting pressure to “tap the brakes” on the rebounding economy.
Minnesota’s Special Session: interested in a recap and an update on where the big issues landed? Great summary here.
Highlights of the Omnibus Tax Bill include:
Read more updates in our weekly Chamber Advocacy Update and more about advocacy this week via our Public Affairs Newsletter
Join us on Wednesday, July 14, for our final virtual “Fun Is Good” membership meeting series, with Mike Veeck and Ila Borders, presented by Securian Financial! Learn how to Dream Big and Wildly Succeed (oh, and work hard too!)/
Be sure to bookmark WelcomeBackStPL.com - new events are added daily!
Here’s a look at reopening dates for major concert and theatrical venues in the Twin Cities.
State of MN Hire a Veteran Month - https://www.careerforcemn.com/HireaVeteran
In a recent Vistage survey: 71% of CEOs plan to expand their workforce in the year ahead. Read Employee Development: The CEO’s Competitive Advantage. The report is free and details, among other things, the key components of employee development.
Join us on Thursday, July 15, for a virtual experience with Breaking Ice: Courageous Conversations on Diversity, Equity, and Inclusion. This is an award-winning program of Pillsbury House Theatre, opening doors for courageous and productive conversations. I LOVE these programs!
DEED is recruiting community members to serve as grant reviewers for adult and youth workforce development training grants during the summer and fall of 2021. They will provide a small stipend to eligible community reviewers. Training will be required and provided. Ready to apply as a community reviewer? Please submit a short application form.
Ramsey County Open for Business program provides direct technical assistance and support to small business owners and entrepreneurs. Attend an Open House to learn of the benefits your business can utilize.
The SBA announced that it is reconvening the Council on Underserved Communities under the authority of the Federal Advisory Committee Act. In conjunction with the Biden-Harris Administration’s agenda, the restoration of the Council will help support the SBA’s prioritization of equity across its programs and initiatives. The Council will consist of 20 diverse stakeholders from every region of the country tasked with advising the SBA on strengthening and improving its strategies to help underserved communities. Nominee Information Form. The deadline is July 20th.
West St. Paul is where it’s at! How Robert Street’s resurgence has re-energized West St. Paul. And West St. Paul’s current projects total more than $200 million.
Metro Transit, expecting commuter recovery, says it'll boost light rail, bus service. Gearing up for the anticipated return-to-office and back-to-school this fall, Metro Transit will be restoring some routes that haven't been operating during the Covid-19 pandemic and adding more trips to others that are expected to get busier.
Met Council awards nearly $500K in pre-development grants to help jumpstart a handful of urban revitalization projects in Mpls, St. Paul, and Brooklyn Park. Included is $150K in support of the Rondo Land Bridge.
The 4-year $240M, 10-mile reconstruction of I35W is approaching its completion in September(!) The next project is even bigger: I494 construction project will overhaul the highway from the MSP International Airport to Hwy 169.
For more about building capacity, check out our Public Affairs Newsletter.