Challenger Workplace Issues Bulletin
MANUFACTURING: “WE’RE NOT DEAD, YET!”
Were warnings of manufacturing’s demise premature? A report out today from the New York Federal Reserve Bank revealed that manufacturing in the state expanded in June at a faster pace and is not just weathering the storm, but actually driving the recovery. Nationwide, manufacturing payrolls have seen a net gain of 126,000 new workers since the beginning of the year, according to data from the Bureau of Labor Statistics. Manufacturers not only added 29,000 workers in May, marking the fifth consecutive gain, but the workweek was longer and the overtime climbed to the highest level in two years. It is unlikely that manufacturing will ever reach its 1979 peak, when factories employed more than 19.5 million workers. However, continued gains could see manufacturing employment return to pre-recession levels, particularly if the country continues to expand research and development in renewable energy technologies, such as wind power. What is driving the gains in the manufacturing sector? What could be the biggest obstacles to sustained growth?
ILLINOIS ACTS TO HELP SMALL BUSINESSES
Illinois small businesses with 50 or fewer employees will now receive a tax credit for hiring full-time workers after Governor Pat Quinn signed the Illinois Small Business Job Creation Tax Credit Act. The governor’s comments indicated that he believes entrepreneurs will lead the country out of the economic downturn and expects the act to create over 20,000 jobs over the next year. Challenger statistics show that start-ups by former managers and executives jumped to a four-year high in 2009, as an average of 8.6 percent of job seekers started their own businesses. The highest period for start-ups came in the third quarter of 2009, as 11.8 percent started their own firms. Will start-ups continue to rise into 2010? Will tax incentives such as these increase hiring?