As many as thirty one entrepreneurs from different parts of the state expressed interest to set up units at the proposed textile park at Padalur on the Tiruchi- Chennai National Highway which is being promoted by State Industries Promotion Corporation of Tamil Nadu (SIPCOT) and the State government had accorded permission to the Directorate of Handlooms and Textiles for the formation of the textile park. The proposal, which hit several bottlenecks with regard to identification of site, was finally fixed at the junction of the Padalur and Irur panchayat on 40.35 hectares — 36.79 hectares of government poramboke land in the Padalur village and 3.56 hectares government poramboke land in Irur village. The proposed Textile Park has also evoked good response from the entrepreneurs. The park will mainly cater to the needs of export-oriented ready-made garments units, production of yarn and so on. The park have also received applications from units for making T-shirts, according to the sources.
A meeting of the entrepreneurs would be held soon in Perambalur when their views would be sought on providing amenities and infrastructure. The Tamil Nadu Water Supply and Drainage Board would ensure adequate water supply to the Textile park. As the park site is about 1 km away from the National Highway. To access the site, a road is being laid now. Originally, the park was planned to have been set up at Eraiyur. But strong objection from the local residents made the district administration shifted the site to the Padalur where a vast extent of government porrambokke land was available. The cooperation extended by the Padalur village panchayat was crucial for materialisation of the proposal.
SOURCE: Yarns&Fibers
The three-day strike by power loom owners in Pallipalayam came to an end after the textile units agreed to increase the job processing charges from Rs. 35 to Rs. 39 for four towels. There are over 400 power loom units in Pallipalayam that manufacture towels in bulk quantities for the textile units. They were paid Rs. 45 as charges for manufacturing four towels weighing 90 gram. But, the charges were reduced over the year with the loom owners paying only Rs. 35. Hence, demanding increase in charges, power loom owners began an indefinite strike from February 2. On Thursday, loom owners held talks with textile unit owners in Erode. While loom owners demanded Rs. 40 as charges, textile unit owners finally decided to pay Rs. 39. Power loom owners agreed and the strike was withdrawn. Production activities began on Friday morning.
SOURCE: The Hindu
Stalemate continues in reaching a new wage pact for knitwear sector workers as the trade unions stood firm on their demands during the talks held between the trade unionists and textile association representatives on Friday. When the trade unions stated that they wanted a 100 per cent hike on basic wages, the knitwear manufacturers put forward the view that they could give 19 per cent hike from the wages in the previous four-year pact, which ceased to exist on January 30. As the trade unionists did not soften the stance, the textile unit owners said that they would come back to the trade unions after discussing with the respective members of the six textile associations.
Next talks
“We will be holding the next round of talks with trade unions on February 16”, said the representatives of various textile associations. M. Chandran, State secretary of CITU, said it was demanded that apart from the hike in basic wages, the workers should be given house rent allowance and also education allowance for their children. “Without house rent allowance, it will be difficult for the knitwear industry to retain the skilled workforce as house rents have been soaring in the cluster during the last many years”, he added.
SOURCE: The Hindu
Raymond is planning to raise Rs 100 crore from the market through private placement basis. The board of the company will meet on February 9 to consider the proposal, Raymond informed BSE. "A meeting of the Committee of Board of Directors of the company will be held on February 09, 2016, inter alia, to consider and approve the Issue of Non-Convertible Debentures aggregating upto an amount of Rs 100 crore on private placement basis," it said.
SOURCE: The Economic Times
Country's handicraft exports grew 10 per cent to Rs 14,782 crore during the first nine months of this fiscal notwithstanding a slowdown globally, the Textile Ministry said. In comparison, the handicraft shipments stood at Rs 13,460 crore during April-December 2014. "In dollar terms, the value of exports has increased by 3 per cent, from USD 2,215 million during April-December 2014 to USD 2,282 million during April-December 2015," an official statement said. The data showed the size of the artmetal wares grew 6 per cent to Rs 3,943 crore, followed by woodwares 10 per cent to Rs 2,564 crore, handprinted textiles & scarves 18 per cent to Rs 699 crore, imitation jewellery 14 per cent to Rs 1,599 crore and miscellaneous handicrafts 12 per cent to Rs 4,033 crore. Overall, during the April-December period of the current fiscal, exports in the segment dipped 18 per cent to USD 196.6 billion as compared to USD 239.9 billion in the same period of the previous fiscal, according to data released by the Commerce Ministry.
SOURCE: The Economic Times
Central government departments and Central Public Sector Undertakings (CPSUs) have made only 10 per cent purchases from medium, small and micro enterprises (MSMEs), against the mandatory requirement of 20 per cent. Procurement from Scheduled Caste/Scheduled Tribe enterprises is worse, at 0.2 per cent, against the mandatory 4 per cent. A review of the purchases made by CPSUs and government departments, done recently by the Prime Minister’s Office, “found that the share of MSME procurement is less than 10 per cent against a mandatory 20 per cent and that of SC/ST entrepreneurship share is less than 0.2 per cent against a mandatory 4 per cent,” the MSME Ministry said in a statement. Following this, MSME Minister Kalraj Mishra, who also reviewed the policy, has directed the Secretary, MSME, to identify the top 50 CPSUs and organise a meeting so that these units can be “sensitised toward meeting the requirement of the public procurement policy of MSMEs”.
SOURCE: The Hindu Business Line
From rural motorbike sales to rail freight, economists and even the central bank are devising their own ways to measure Indian growth. Their verdict? It’s a good deal weaker than official data showing India to be the world’s most dynamic big economy. Doubts about the accuracy of India’s gross domestic product figures persist a year after its statisticians unveiled new readings they say better capture value addition down the goods and services supply chain. Under the new methodology, economists expect India will report GDP growth of 7.3 percent on Monday for the October-December quarter, according to a Reuters poll. That’s a touch slower than the previous quarter but comfortably surpasses the 6.8 percent growth posted by China. While that number appears strong, the lack of a historical series – still in the works – makes it hard to conclude that Asia’s third-largest economy is doing well at a time when firms report poor sales, bank lending is slow and investment is weak. “It doesn’t feel like we are growing at 7-8 percent,” said one official familiar with the Reserve Bank of India’s research methods.
Like other economists, the RBI is now turning to hybrid models that mix elements of the old and new GDP methods to get a better feel for the underlying health of the economy. The RBI looks at two-wheeler sales, car sales, rail freight, and consumer goods sales in rural areas “to get a better understanding of the ground realities”, this official said. The new data is a headache too for Finance Minister Arun Jaitley, who faces tough choices in his Feb. 29 budget over whether to hike borrowing and spending to compensate for the sluggish private sector.
HEAT MAP
By its own proprietary measure, Ambit Capital estimates the economy may have grown an annualised 5 to 6 percent in the October-December quarter. “India is not the fastest growing economy in the world,” said Ritika Mankar Mukherjee, an Ambit economist in Mumbai. “No matter how you cut it, while there are certain segments of the economy holding up such as IT or e-commerce, large parts of the economy are actually slowing down.” Economists have drawn on techniques used by colleagues covering China, where GDP figures are widely suspected to have been smoothed for years by its communist rulers to underpin popular faith in their economic stewardship. Ambit looks at criteria such as motor vehicle sales, power demand, and imports of capital goods to determine the real rate of expansion. Meanwhile, Citigroup has developed a heat map of 18 economic activities including two-wheeler sales, air traffic, and diesel sales.
Downbeat assessments of growth would more closely correspond with trends under the old GDP calculation method that until a year ago showed India experiencing the longest spell of sub-5 percent growth in a quarter of a century. The slowdown is especially pronounced in rural areas, which have suffered two consecutive dry years. “Demand is very weak because farmers’ income has been squeezed by drought,” said a Mahindra and Mahindra tractor dealer in Aurangabad, in the state of Maharashtra, who reckons his sales are down more than 20 percent from a year ago. Ashish Kumar, who recently retired as the head of India’s statistics office, says economists are using the wrong gauges to understand data that measures value addition. “You have to understand that the new GDP data essentially captures efficiency,” he told Reuters. “Comparing it with volume-based indicators would be a mistake.”
RBI Governor Raghuram Rajan has also endorsed the new GDP readings, saying sliding input costs are offsetting shrinking corporate revenues and inflating value-addition. Put more simply, sales may be slow but profits are rising. Still, the statistics office is readying tools to better capture services sector data for GDP calculations and supplement it with employment generation data. “Once we have all these data points, we will get a better picture,” said Kumar.
SOURCE: The Financial Express
Chief Economic Advisor Arvind Subramanian on Friday said low oil and commodity prices will help strengthen the macroeconomic fundamentals at a time when the external environment poses a challenge and has led to a fall in exports. “India continues to be a haven of macroeconomic stability,” he said at the India Investment Summit 2016, while urging foreign investors to fund domestic infrastructure projects. He said amidst high uncertainty in the global economy, the slump in oil, steel and cement prices provides a good opportunity for investing in India. “Although it is a challenging time, it is a kind of positive shock for investing in infrastructure. If oil, steel, cement, commodity are down, the cost of building infrastructure comes down and returns to infrastructure goes up,” he said. Urging investments in infrastructure, Subramanian said private investments and consumption are necessary drivers of domestic demand in the challenging international environment and also outlined government plans for public investment.
High priority areas
“Railways, road, irrigation are going to receive high priority. So there is emphasis on domestic investment and international environment has made return on investment actually go up,” he said. Minister of State for Finance Jayant Sinha also underlined government efforts to address challenges in the infrastructure sector. “We are working very hard to understand what the issues, challenges are and what further we need to do as far as the law, regulation and project structuring are concerned, so that we can present to you attractive returns and where risks are much lower,” he said, adding that projects worth $150 billion are in various stages of completion. Urging investors to consider investments in brownfield projects, he also announced that the Centre is trying to rethink the financing of greenfield projects to ensure that they get the cash flow as early as possible. Sinha said the Centre has also asked State governments to send their project pipeline, which can be made a part of the deal flow of the National Investment and Infrastructure Fund. “We are working in collaboration with States on the NIIF,” he said. Reserve Bank of India Deputy Governor HR Khan also assured investors of support and said, “We are open for regulatory changes. We are sensitive to demands.”
SOURCE: The Hindu Business Line
Residents and traders in southern Nepal on Friday dismantled tents and roadblocks set up by protesters at a key border crossing, allowing trucks to cross freely from neighbouring India for the first time in four months. More than 50 people have died in an agitation against Nepal's first republican constitution led by minority madhesis, who say the charter ignores their demands for a united homeland and greater say in the running of the Himalayan nation. A prolonged blockade mounted by southern lowlanders on the "Friendship Bridge" linking the Nepali town of Birgunj with Raxaul in India had caused acute fuel shortages and spurred smuggling along the porous border. "Trucks are moving smoothly," Nepali police official Habendra Bahadur Bogati told Reuters. "We hope that it will be normal. But we can't say if this will continue." People in Birgunj and Raxaul, in India's eastern state of Bihar, had cleared tents pitched on the bridge by protesters from the madhesi minority, added Raju Babu Shrestha, a second police official. Twenty container trucks rolled into Nepal for the first time since the blockade started in September, said customs official Mitralal Regmi. In November, police forcibly removed protesters from the bridge, leading to clashes with protesters that killed one Indian citizen.
SOURCE: The Times of India
Bullish on India, IMF chief Christine Lagarde has hoped that the Government would be able to implement a series of "critically important" economic reforms including GST for unleashing the country's growth potential. "The IMF is quite bullish about India, and our forecast for 2016, 2017 is 7.5 per cent growth," Lagarde said in response to a question at the University of Maryland yesterday. "So we see India as benefitting, actually it's one of the major beneficiaries of the lower oil prices. When you look at the scale of benefits for particularly the emerging countries, India comes out, you know, way ahead," the IMF's managing director said. "IMF also believe that the monetary policy, the taming of inflation is also going to benefit the very large domestic market of India," she said, noting that consumption is also going to be one of the key drivers. "All of that of course, with the hope and the provision, if I may say, that the trend of reforms identified by Prime Minister Narendra Modi, can actually proceed, whether it's in the fiscal area, by way of implementing the Goods and Services Tax, significant reform like the land reform that is considered," Lagarde said.
SOURCE: The Business Standard
The ongoing drop in polyester prices has cut into cotton's market share, particularly in China where polyester has been favoured over cotton in recent seasons. “When cotton prices dropped at the start of 2014/15, the gap between the Cotlook A index, and polyester prices in China narrowed significantly and greatly improved the competitiveness of cotton,” an ICAC press release said. “However, this only lasted for a few months as polyester prices continued to drop while cotton prices stabilised,” the cotton trade body observed. According to ICAC, in 2015/16, that gap has continued to widen, with polyester prices falling from 52 cents per pound in August 2015 to 43 cents per pound in January 2016. During the same period, the Cotlook A Index has averaged 70 cents per pound, ranging from a high of 74 cents per pound to a low of 66 cents per pound.
In the press release, ICAC also added that cotton consumption in China is forecast down 5 per cent to 7.1 million tons in 2015/16, though it still remains the world's largest consumer of cotton. While, world cotton consumption in 2015/16 is projected down 1 per cent to 24.1 million tons, with India's consumption expected to be up 2 per cent to 5.5 million tons, while Pakistan's will dip 12 per cent to 2.2 million tons. Consumption in Turkey will likely remain stable at 1.5 million tons, while consumption in Vietnam and Bangladesh are expected to grow by 22 per cent to 1.1 million tons and 13 per cent to 1.1 million tons, respectively. “Given the fall in consumption and lower domestic cotton prices, China's imports are expected to fall by 40 per cent to 1.08 million tons,” ICAC noted. “However, if the pace of its imports remains steady, then Vietnam may overtake China as the largest importer of cotton in 2015/16,” the body again observed.
Cotton imports by Vietnam for the first four months of 2015/16 totaled 327,000 tons, while those by China totaled 247,000 tons. m2015/16 cotton imports by Vietnam are projected to be up 17 per cent to 1.1 million tons and imports by Bangladesh are forecast to increase by 12 per cent to 1.08 million tons. Consumption in both Vietnam and Bangladesh is increasing steadily, due to lower production costs, but both produce very little cotton, and instead rely on imports to meet demand. ICAC estimates that world ending stocks will decrease by 7 per cent to 20.5 million tons, which represents about 81 per cent of world cotton consumption in 2015/16. As per ICAC, the reduction in stocks this season is attributed to the sharp drop in world cotton production rather than gains in consumption. 2015/16 world cotton production is forecast down 14% per cent to 22.5 million tons as world cotton area contracted by 9 per cent to 31.1 million hectares, in response to relatively low cotton prices. Of the top 10 producing countries, China, the United States and Pakistan saw the largest decreases in volume.
SOURCE: Fibre2fashion
Anyone who has visited Turkey and spent time in Istanbul, shopping in the Grand Bazaar, gorging on baklava and sipping tar-black Turkish coffee, will also no doubt have noticed one of the two imposing bridges spanning the Bosphorus, linking the Asian and European sides of the city. Turkey is often described as the bridge between East and West, and as such has been a centre of trade for thousands of years. The country has been a focus of importance for the manufacturing of many different types of goods, including the famous Turkish rugs sought by shoppers from around the world. Now a large portion of Turkish textiles are made using man-made fibres, including polypropylene (PP) which is the largest imported polymer into the country. Consumption is focused, around the city of Gaziantep, where many textile manufacturers have their facilities. Turkish manufacturers rely heavily on PP imports although there is some domestic capacity (Petkim with 144,000 tonnes of nameplate capacity) and a relatively low volume of exports (21,911 tonnes in 2015, according to Turkstat). Turkey imported a total of 1,565,242 tonnes of PP in 2015 according to Turkstat, with over 30% of that volume coming from Saudi Arabia, the clear leader of the exporting pack. Saudi material has an average delivery time of around 4-6 weeks, an import duty rate of 6.5%, and cargoes are traditionally sent to the ports of Istanbul in the north of Turkey, and Mersin in the south to serve Gaziantep. However, as Turkey’s political and economic circumstances have changed, so has the country’s supply of PP. In 2015, the volatile upstream market and a preference for just-in-time deliveries dramatically changed the position of other exporting countries to Turkey.
India remains the second largest exporter to Turkey, sending over 123,000 tonnes of PP to Turkey, but the volume of Iranian and Egyptian exports has increased substantially. Egyptian exports jumped by 800% between 2010 to 2014, while South Korean exports rose from 17,000 tonnes to 75,000 tonnes, an increase of 340%. Also of note is the increase in imports from Russia and Turkmenistan during that four year period. Egyptian exports have seen further increases, overtaking India as Turkey’s second largest PP supplier while Indian exports dropped significantly. Iranian exports have remained fairly balanced, while Russian and Turkmen exports have surpassed 2014 levels, with Russia almost doubling exports to Turkey.
So what has changed in 2015 to cause such a shift in exports to Turkey from non-Saudi producers? The answer requires a bit of a history lesson and is formed of many parts which came together with some perfectly-timed coincidences from early 2015. It created an atmosphere of uncertainty that has plagued the Turkish PP market since. Turkey started 2015 with the lowest prices seen since 2009 brought on by the drop in crude oil and feedstock prices. With no one sure exactly how far crude would fall during the first part of 2015, and when PP prices would bottom out, Turkish PP buyers, along with buyers from most other regions, took a very cautious stance and started buying on a hand-to-mouth basis. With Turkish spot prices dropping almost daily, inventories were kept low as buyers feared taking large volumes only to find they could have bought cheaper had they waited a little longer before concluding deals. The bearish sentiment soon turned bullish as a spate of force majeures across Europe, together with production problems in the Middle East, saw prices take a rapid upward turn towards the end of the first quarter as availability tightened. At the same time, Iranian suppliers, some of whom had been offering very low prices to neighbouring Turkey during January for prompt material, stopped exporting to Turkey in favour of more profitable markets. All of a sudden Turkish buyers found themselves facing significantly higher offer prices from suppliers as material was diverted to other, more profitable regions.
Despite demand in Turkey remaining weak, buyers who did need material were forced to pay substantially higher prices during the second quarter than they had in January even as they continued to purchase on a hand-to-mouth basis. While Europe suffered from a lack of material and unprecedented levels of outages, Turkey was having some internal problems of its own that would only go to dampen buyers’ appetites in the second half of the year. Having seen regional and presidential elections in 2014, Turks went to the polls on 7 June 2015 for the first of what would be two elections that year. When the ruling Justice and Development Party (AKP) failed to get a majority, and coalition talks broke down in the months afterwards, the Turkish lira, which had been dropping since the end of 2013, declined further against the US dollar before hitting record lows in September. At the same time, terrorist attacks by both IS and the Kurdistan Workers’ Party (PKK) in the southeast of Turkey caused more concern, both politically and economically. Turkey was without a government, its currency was slipping and exports of PP-produced finished goods were dropping. Credit issues and a lack of cash flow were causing concerns amongst suppliers and traders as some buyers defaulted on payments. Uncertainty prevailed. However, Turkish buyers were to get a break from the higher-priced material at the beginning of the second half of the year as things started to work in their favour. European producers were bringing facilities back online while production problems in the Middle East and India eased, and global supply improved. In Asia, feedstock propylene prices had been dropping since June on lower crude numbers, and buyers in Turkey took this as another sign that a cautious hand-to-mouth buying sentiment would eventually reward those prepared to wait with ever-reducing PP prices. They were not disappointed.
SOURCE: ICIS
According to The Future of Dye-Sublimation Printing to 2021, an estimated total of around 384 million square metres of fabric were printed digitally via dye sublimation in the year to Q1 2016, having grown by just under 18.4% in the past year 2015-16. This is set to rise to 892 million square metres in 2021.The four major end-use segments are garments; household (carpets, wall coverings and upholstery); technical and visual communications (displays and signage); and technical textiles. This last category includes automotive (seats, seat-belts, seat head lining, panels, sound absorption), bags, medical and scientific textiles, sails, tents, parasols/umbrellas, accessories and sports equipment.he garments segment is the largest end-use sector, with 75% of the market share by value in 2016. The other segments each take 5-10% of the market. What is driving the market, in very basic terms, is the increasing demand for rapid customisation to create beautiful, unique clothing or household products. This is more and more made possible by digital printing technology. In turn, printers must turn around the production and delivery of dye sublimation products ever more quickly to meet this demand.
Applications of digital dye sublimation textile printing include, in order of run length: unique one-offs, sampling, micro-runs, short production runs and increasingly long bulk production runs in the multiple thousands of linear metres. This last is the new battleground with conventional analogue textile print, which dye sublimation is looking to disrupt with a new generation of high-productivity presses.Dye sublimation specific machine annual revenues amount to a total of €279 million ($304 million) to Q1 2016. Dye sublimation inks revenues amount to a total of around €259 million to end Q1 2016.
Globally, digital textile printing output grew at more than 45% annually between 2004 and 2009 from a low base. From 2009, growth slowed somewhat, in part due to the fact that the near-exponential growth rates of early years could not be sustained as the market became more mature, but also because of the global economic slowdown. Dye sublimation digital printing was nascent in the period 2004-9. The sublimation dye market attracted attention as it was clearly growing rapidly between 2011 and 2015, in some countries at over 50% per year from a low base. The market participants collectively now predict a lower rate of growth going ahead to 2021, but at 18.4% CAGR, dye sublimation continues to be an appealing fast-growing market that will more than double in terms of volume printed and value over the study period. In terms of regional markets, Asia (including Turkey) is having, and will continue to have, the strongest growth. Conversely, the highest per unit price will continue to be seen in North America and Western Europe. The Future of Dye-Sublimation Printing to 2021 provides data and an exclusive analysis designed for organisations at all phases in the value chain looking to capitalise on opportunities in this booming segment. It examines global and key regional markets for dye sublimation print, which is contextualised with analysis of the state of the art in dye sublimation printing and expert analysis of the technical and market drivers that are fuelling growth.
SOURCE: The Smithers Pira
Following Heimtextil Frankfurt in January, Messe Frankfurt's next interior and contract textiles event will be Intertextile Shanghai Home Textiles – Spring Edition, which takes place from March 16–18 in Shanghai. “March is the peak sourcing season in China for finished products, particularly bedding items, and this market has been growing rapidly in recent years,” Messe Frankfurt informed in a press release. Quoting a CCPIT market research report, the organiser said domestic bedding sales in China reached $49 billion, an increase of 2.7 per cent compared to 2014. Reflecting this growth, a number of top domestic bedding suppliers, including Bejirog, Beyond Group, Esteem Home, Fuanna, Luolai, Menglan, Shuixing, South Bedding Series and Yuyue are participating. They will be joined by other domestic towelling suppliers including Cottonfield, Dadong, Grace, Loftex and Sunvim Group at the Spring Edition.
According to a report by the China Home Textile Association (CHTA), sales figures from some of China's most important home textile sourcing markets grew strongly between January and September 2015. Haining China Home Textile City, Dieshiqiao Home Textile Market and Gaoyang Commerce City for towelling recorded sales increases of 40 per cent, 9.5 per cent and 4.5 per cent, respectively, during this period. Wendy Wen, Sr GM of Messe Frankfurt (HK) said, “Chinese consumers are increasingly demanding high quality and luxury home products, and are paying more attention to stylish and personalised home décor items.” “This change certainly creates strong potential for overseas suppliers of premium and high quality products,” she observed. “The huge demand for home renovation projects in China also creates opportunities for home textiles producers,” Messe Frankfurt informed.
Referring a survey from a domestic home living website, Messe Frankfurt informed that the value of home renovation projects is forecast to exceed $48 billion annually in coming years. “Furthermore, according to figures from 2014, textile products account for around 25 per cent of the total cost of home renovation projects in China,” it noted. Held alongside this fair are four other textile events, which includes Intertextile Shanghai Apparel Fabrics – Spring Edition, Yarn Expo Spring, PH Value and CHIC.
SOURCE: Fibre2fashion
Job growth settled into a more sustainable pace in January and the unemployment rate dropped to an almost eight-year low of 4.9 percent, signs of a resilient labor market that’s causing wage growth to stir. The 151,000 advance in payrolls, while less than forecast, largely reflected payback for a seasonal hiring pickup in the final two months of 2015, Labor Department figures showed Friday. The jobless rate fell to the lowest level since February 2008. Hourly earnings rose more than estimated after climbing in the year to December by the most since July 2009. The moderation in hiring still leaves the job market on solid footing and shows companies are confident about the outlook for domestic sales. A further tightening of labor conditions that sparks wage gains would help assure Federal Reserve policy makers that inflation will reach its goal. “This is a very encouraging report -- the fact that wages rose is very important, the unemployment rate continues to go lower, and job growth at 151,000 is still a good number,” said Kathy Bostjancic, an economist at Oxford Economics USA in New York, which is among the best forecasters of the payrolls data over the past two years, according to data compiled by Bloomberg. “We can’t continue at December’s pace going forward -- that’s not sustainable.” While employment at temporary-help agencies and couriers declined in January following a ramp-up ahead of the year-end holidays, the labor market showed strength elsewhere.
By Industry
Retailers added almost 58,000 jobs last month, the most since November 2014, and the health care industry took on another 44,000 workers. Perhaps most surprising was a 29,000 gain in hiring at manufacturers, the biggest increase since August 2013. Payrolls picked up at producers of fabricated metals, automobiles, food and furniture. Within retail, department stores and clothing outlets added a combined 26,500 jobs. The median forecast in a Bloomberg survey called for a 190,000 gain in overall payrolls last month, with estimates ranging from gains of 142,000 to 260,000. December payrolls were revised down to 262,000 from 292,000 and November employment was revised up to 280,000 from 252,000. The revisions to these months subtracted a total of 2,000 jobs to overall payrolls. Friday’s data showed a much-awaited pickup in wage growth is starting to manifest itself. Average hourly earnings rose 0.5 percent from a month earlier to $25.39. The year-over-year increase of 2.5 percent followed a 2.7 percent jump in the 12 months ended in December, which was the biggest advance since mid-2009.
At least some of the increase was due to 14 states beginning the new year with higher minimum wages. Of those, 12 increased their minimums through legislation, while two states automatically boosted their wage rates through cost-of-living adjustments. Minimum-wage legislation “may have boosted average hourly earnings a little bit for the month, but minimum wage jobs and other categories that are associated with that are still a relatively small component of the distribution of employment,” said Russell Price, a senior economist at Ameriprise Financial Inc. in Detroit. The report also showed the average work week for all private employees increased by 6 minutes to 34.6 hours, the longest since August. A longer workweek often amounts to greater take-home pay for many employees. The gain in employment combined with the increases in the workweek and wages lifted the index of aggregate weekly payrolls by 0.9 percent last month, the most since November 2014. The Labor Department’s figures included its annual benchmark update, which aligns employment data with state unemployment benefit tax records.
2015 Employment
The revision showed the economy created 206,000 fewer jobs from April 2014 to March 2015, in line with a preliminary projection of 208,000. Still, for all of 2015, the economy created 2.74 million jobs after 3 million a year earlier. Additionally, the agency incorporated new Census Bureau population estimates into the household survey. The adjustment boosted the estimated size of the workforce by 218,000. The unemployment rate, which is derived from a separate Labor Department survey of households, fell in January from 5 percent in December. The labor force participation rate, which indicates the share of working-age people who are employed or looking for work, increased to 62.7 percent from 62.6 percent.
Fed policy makers are tracking the labor market as part of their dual mandate for maximum sustainable employment and stable inflation. The jobs data take on added meaning as other parts of the economy have shown signs of slowing. Economic growth decelerated to a 0.7 percent annualized rate in the final three months of 2015 after growing at a 2 percent pace in the third quarter. The manufacturing sector has contracted for four months, and data this week showed the softness may be extending to services industries, which make up about 90 percent of the economy.
SOURCE: The Bloomberg
