U.S. Economic News

September 1, 2016

U.S. Economic Indicators

After expanding five consecutive months, the ISM Manufacturing Index fell 3.2 percentage points to 49.4 in August — the largest decline since January 2014.  The employment index fell 1.1 percentage points to 48.3 and the new orders index fell 7.8 percentage points to 49.1.  ISM Report

Jobless claims increased 2,000 to 263,000 last week.  The four-week moving average declined 1,000 to 263,000.  DOL Report

Nonfarm business sector labor productivity for Q2 decreased at a revised, seasonally adjusted annual rate of 0.6% after declining at a similar pace in Q1.  This is the third quarterly decline in a row, the first time that has happened since 1979.  In year-over-year terms, productivity was down by 0.4.  Hours worked increased 1.7% and unit labor costs increased 4.3% in the second quarter.  BLS Report, WSJ

U.S. Economic News

According to Colombia Business School economist Geoffrey Heal, President Obama’s pledge to reduce greenhouse gas emissions by 80% from 2005 levels by 2050 could cost over $5 trillion.  Heal argues that because the program to reduce GHG emissions is not a line item in the federal budget, the financial costs would be picked up by utilities companies, and then ultimately passed down to consumers. Heal believes that these costs are achievable and manageable, only if the government establishes “very strong” financial incentives, such as a carbon tax.  WSJ

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