U.S. Business Dynamics Data

Hopefully you know about this one. It's a great national data source for understanding business openings, expansions, and closings.

The BLS Business Employment Dynamics data are quarterly series of gross job gains and gross job losses statistics for the entire economy. These data track changes in employment at the establishment level, and thus provide a picture of the dynamics underlying aggregate net employment growth statistics.

From June to September 2003, the number of job gains from opening and
expanding establishments was 7.4 million, and the number of job losses
from closing and contracting establishments was 7.3 million, according to
preliminary data released today by the Bureau of Labor Statistics of the
U.S. Department of Labor. This release of the Business Employment Dynamics
series includes major industry sectors for the first time. During the third
quarter of 2003, gross job losses exceeded gross job gains in goods-produc-
ing sectors, while gross job gains surpassed gross job losses in service-
providing sectors.

Opening and expanding private sector business establishments gained 7.4
million jobs in the third quarter of 2003, or 164,000 less than in the se-
cond quarter of 2003. Over the quarter, expanding establishments added
5.9 million jobs, while opening establishments added 1.5 million.

Gross job losses totaled 7.3 million in the third quarter of 2003, down
by 378,000 from the second quarter of 2003. The drop in gross job losses
during the quarter more than offset the drop in gross job gains, resulting
in the first net employment gain since the fourth quarter of 2000. Gross
job losses have been on a downward trend since the third quarter of 2001.
In the third quarter of 2003, contracting establishments lost 5.9 million
jobs, while closing establishments accounted for a loss of 1.4 million
jobs. (See tables A, 1, and 3.)

From June to September 2003, gross job gains represented 6.9 percent of
private sector employment, while gross job losses represented 6.8 percent
of private sector employment. (See tables A and 2.) These gross job gain
and loss statistics demonstrate that a sizable number of jobs appear and
disappear in the relatively short time frame of one quarter.

More here.

County Economic Growth Report

Here is one that should interest you.

In December 2003, Clark County, Nev., and Loudoun County, Va., had the
largest over-the-year percentage increases in employment among the largest
counties in the U.S., according to preliminary data released Friday by the
Bureau of Labor Statistics of the U.S. Department of Labor. Clark and
Loudoun counties experienced over-the-year employment gains of 5.2 percent
each, compared with zero job growth in the nation. Collier County, Fla.,
had the largest over-the-year gain in average weekly wages in the fourth
quarter of 2003, with an increase of 9.7 percent. The U.S. average weekly
wage increased by 3.6 percent over the same time span.

Of the 315 largest counties in the United States, 171 had over-the-year
growth in employment and 137 experienced declines in employment, while the
national average employment level was unchanged. (See chart 1.) Average
weekly wages grew faster than the national average in 166 of the largest
U.S. counties, while the percent change in average weekly wages was below
the national average in 144 counties.

More here.

Ontario Workers Paid Less

Wages for Ontario workers are 23 per cent less than those in the U.S. in the industries that are most important to Ontario's prosperity, says a preliminary report released Friday by an institute supported by the provincial government.

Ontario firms are not as productive as their American equals because they don't face the same competitive pressures that develop in industry clusters across the border, said James Milner, executive director of the Institute for Competitiveness and Prosperity.

"Those two factors ... we think go together to cause our firms to be not as productive as they could be, and then, with that lower productivity, wages tend to go down," he said in an interview.

The institute assessed the impact of market structures on Ontario's competitiveness to help understand the causes of the province's $4,118-per-capita prosperity gap compared to a peer group of U.S. states.

Interesting article abd stufy. Find more here.

Manufacturing Production Still Up

The manufacturing sector expanded for the 13th consecutive month in June, albeit at a slightly slower pace. The Institute for Supply Management said its manufacturing index declined to 61.1 last month from 62.8 in May. The new reading was somewhat lower than the 61.5 forecast by analysts.

But an index reading above 50 indicates expansion, while one below 50 indicates that manufacturing activity is contracting. The gauge has been above 50 since June of last year. The June reading shows manufacturing growth has slowed slightly but is “still aggressive,” said Norbert Ore, who heads ISM's survey committee.

More here.

Chinese Car is Coming?

Experts say yes, it's inevitable that Chinese cars will eventually be a major force in the U.S. and other developed markets. But they say that while the cars will be made in China, they will likely carry very familiar Western brand names like Chevrolet, Honda and Volkswagen.

"If you look at mistakes they (U.S. automakers) made with the Japanese automakers, they missed their opportunity to partner with and be a controlling force behind Toyota and Nissan," said Denton Dance, director, emerging markets forecasts for J.D. Powers & Associates. "The global Big Eight are not going to sit by the side and let something big come into their home markets from China without being a part of it."

I know what you're thinking...will the Chinese eventually produce their product in the U.S. It's worth them thinking about, especially in alliance with a U.S. or Japanese vehicle manufacturer.

More here.

25 Rules for Leaders

This is not a direct fit for economic development, but it provokes some interesting thinking about how we spot and create business leaders in our community.

Here is a sample. Audit your organization's culture(s): "Companies don't have one culture. They have as many as they have supervisors or managers. You want to build a strong culture? Hold every manager accountable for the culture that he or she builds."

Click here and see what Fast Company has to say.

What's Ahead for Low-Cost Airlines

Has you community recently inked a deal with a low-cost airline? You may want to read this recent article by the Economist on what lies ahead. Brace yourself.

Innovative and bold low-cost carriers have transformed the airline industry on both sides of the Atlantic. But are they now doomed to lose their momentum?

More here.

Who Works Hardest in the World?

If you want an answer to that question, click here to read about a new OECD report on the subject.

One conclusion is that compared with the rest of the world, Australians spend a lot of time at their job.

According to the latest Organisation for Economic Cooperation and Development's (OECD) employment outlook, full-time and part-time working Australians put in an average 1,814 hours each year, equating to almost 38 hours a week over the 48-week working year.

That made Aussies the sixth-hardest workers among the 30 OECD nations, behind Korea, Czech and Slovak Republics, Greece and Mexico.

Norway had the lowest working hours with 1,337 a year, or under 28 hours a week taking into account four weeks holidays a year, compared with Korea's effort of almost 50 hours a week.

The 1,814 average annual hours worked by Australians in 2003 was significantly less than the 1,904 hours - or just under 40 hours a week - racked up by workers in 1979.

Fetch the report here.

Long Island Looks to Incubators for Minority Business Development

Click here to read about how Long Island ED officials plan to use incubators to stimulatemore minority business development.

New Report Links Education and Economic Development

As state and local governments face tough funding choices and tight budgets, a new Economic Policy Institute report shows adequate and effective funding of education is the best way to achieve faster growth, more jobs, greater productivity, and more widely shared prosperity.

Smart Money: Education and Economic Development, written by economic development expert and researcher William Schweke, shows how increased investment in education, from preschool to college, provides concrete returns to economic development through increases in productivity, learned skills, technology and workers' average earnings.

For journalists across the country, Schweke will join a panel of education and economic experts to lead a media conference call on how investment in education is essential in advancing economic equality and keeping the U.S. workforce competitive in a knowledge-based economy.

Get it here.

Corporate Board Research

Here is a short Board profile for Wal-Mart, which is just one example of company information you can get at Corporate Board Analyst. (Free registration required.)

Wal-Mart Stores, Inc. operates numerous discount stores and supercenters throughout the United States and several other markets worldwide. Principally engaged in mass-merchandising offering customers discounted goods and services through innovative marketing strategies. BOARD OVERVIEW: The Wal-Mart Stores (WMT) board consists of 14 directors, of which 11 are outside or 'non-executive' directors. Chairman S. Robson Walton is a former executive of the company.

While the Wal-Mart Stores board has a nominal outside majority, 5 of the nominally outside directors have reported relationships with the company that investors or underwriters may wish to examine more closely to determine their actual degree of independence. Please note, however that we highlight these relationships for informational purposes only. While in some cases they may reflect potential conflicts of interest, in many other cases the presence of such directors may instead be to the shareholders' benefit, and contribute to the overall strength of the board. Board independence alone is generally not a major factor in our ratings.

Additional information on any such relationships may be found in the individual director profiles, or in most cases by clicking on the 'outside related' links included in the table below. According to their most recent proxy, the board met 4 times last year. The outside directors also meet separately from management, an especially important indicator of overall board independence. The company's formal governance policy may be accessed online (see below). The company's business ethics code may be accessed online (see below). There are 2 female directors. There are no directors over seventy. There is one director who is an active CEO at another firm. CEO H. Lee Scott is 55 years old. Scott has been CEO since 2000. Wal-Mart Stores is audited by Ernst & Young LLP.

Canadian Company Research

Looking for information about Canadian companies. Start here. This online searchable directory has good information on technology businesses, including those in the life sciences.

A Look at Canada's Economic Regions

The Regional Economic Observer provides an overview of the recent economic performance of Canada's provinces and territories, including information on labour markets, economic activity and prices.

Download a terrific Canadian regional economic analysis report here.

California Economy Shows Positive Signs

Despite job losses in government, information, and the non-farm manufacturing sectors, California saw a net gain of 23,600 jobs in May - a full 9.5% of the 248,000 jobs created across the US, according to the California Employment Development Department (EDD).

The increase marked a third straight month of growth, said the agency's latest Labor Market Review, which reported an increase of 14,501,200 jobs in total non-farm industries in May, up 23,600 jobs from last month, following a 15,700-job gain in April and a 21,500-job gain in March.

Compared with May 2003, non-farm employment in the state grew by 110,200 jobs, a 0.8% rise.

This places the California job growth rate nearly on par with that of the nation, the report said.

The release of the employment figures comes as the US Census Bureau's International Trade Division announced that California's merchandise export trade continued to run 25% ahead of last year.

During the first four months of 2004, the Census said, the state's exports totaled $36.3 million, up 25.02% over the $29 million reported for the same period last year.

More here.

Honda's Impact on Ohio Economy

Press Release from Honda Manufacturing of America

Honda's annual payroll within the state of Ohio has topped the $1.1 billion mark as the company celebrates its 25th year of manufacturing in the United States, Koki Hirashima, president and CEO of Honda of America Mfg. Inc., said today.

Hirashima, addressing the Dayton Area Chamber of Commerce, said the payroll figure is generated by the 16,000 Ohioans who work for Honda. An additional 20,000 supplier-industry jobs in the state are tied directly to the manufacture of parts for Honda.

"Twenty-five years ago, Honda formed a partnership with Ohio," Hirashima said. "Together, we have been successful in ways that even the most optimistic among us could never have predicted.

"Thanks goes to our associates, suppliers and business partners, and to the state and local communities where we and our suppliers have operations."

Hirashima also told the Chamber gathering:

-- Honda's operations in Ohio began in 1979 with 64 associates working in motorcycle production. Today, Honda of America is the No.1 auto producer in Ohio, having turned out 677,389 Accords, Civics, Elements and Acura products in 2003, as well as 108,525 motorcycles and ATVs and 1.1 million auto engines.

-- Of the $12.6 billion Honda pays U.S. suppliers each year, more than $7 billion goes to Ohio suppliers and into the state?s economy.

-- Honda's 175 Ohio suppliers employ more than 40,000 people and more than half of these employees are directly involved in manufacturing for Honda.

-- Growth through capital investment has been a hallmark of Honda's Ohio experience. In the past 25 years, Honda made more than $6 billion in capital investments in the state, while its suppliers have contributed $1.5 billion.

The success of the Marysville Motorcycle Plant in 1979 led Honda to quickly add car production, turning out the first Japanese automobile in the United States in 1982 at the Marysville Auto Plant. The Anna Engine Plant, opened in 1985, became Honda's largest engine plant in the world. Honda investment continued with the East Liberty Auto Plant in 1989, Honda R&D Americas-Ohio Center in Raymond and Honda Transmission Mfg. in Russells Point.

Investment and upgrading is ongoing at Honda in Ohio.

"We just announced plans to build a new $123 million paint operation at the Marysville Auto Plant -- our biggest investment yet to update our Ohio auto plants," he said. "As we've matured, we've continued to refresh and enhance our facilities as an investment in the future."

Honda's Ohio research and development arm "develops new car and light truck models, including research, design, testing and prototype development for products manufactured in North America," Hirashima said, adding that a new $30 million crash-test center opened at the Raymond facility last fall.

Honda also operates a service parts, distribution and safety-training center in Troy, which employs 320 associates.

Hirashima serves as managing director of Honda Motor Co. in Tokyo and heads the engineering functions of Honda's North American operations.

He said the strength of Honda's operations comes from the capable team of Ohio associates who run the manufacturing operations.

"When Honda announced in 1977 that it was coming to Ohio to build motorcycles, industry experts thought it was a foolish decision. They said American workers could never build vehicles to Honda's quality standards," Hirashima said. "A few might even have said we were crazy.

"But in Ohio, we found strong values, a good work ethic, and an understanding of what it means to work together as a team," he said. "Based on respect and openness to new ideas, we are able to achieve great things together, in our plants, and in our communities."

Honda's suppliers are spread across 55 of the state's 88 counties and include more than 30 vehicle parts and materials suppliers in the Dayton area.

More here.

In-Sourcing Impacts

Few would deny that international companies contribute a great deal to the American economy. Those who defend "Out-Sourcing," have coined the term "In-Sourcing," to account for the economic impact of foreign direct investment (FDI) in the U.S.

Frankly, those of us who have been around for a while, don't need to be convinced of the benefits of FDI. It's great! But it's hardly an offset for offshoring work.

Cross-investment by companies on all continents is a feature of globalization. That is a reality for everyone to live with. U.S. companies build facilities abroad and foreign companies build them in the U.S. The truth is that most FDI in the U.S. takes the form of acquisitions of U.S. companies by foreign companies. These acquistions account for nearly 85% of all FDI by foreign companies in the U.S.

In any case, here are the numbers on "insourcing":

-U.S. subsidiaries employ a record high 6.4 million Americans.

-U.S. subsidiaries support an annual payroll of $350 billion and pay, on average, 19.1% more than all U.S. companies.

-U.S. subsidiaries heavily invest in the American manufacturing sector. Thirty-four percent of the jobs at U.S. subsidiaries are in manufacturing -- more than double the proportion of manufacturing at all U.S. companies.

-Annual federal taxes paid by U.S. subsidiaries are at a record high of $28 billion.

-U.S. subsidiaries manufacture in America to export goods around the world -- accounting for over 22.4 percent of all U.S. exports.

-Over the last 15 years, manufacturing "insourced" jobs grew by 82% - at an annual rate of 5.5%; and manufacturing "outsourced" jobs grew by 23% - at an annual rate of 1.5%.

-Over the same period, total "insourced" jobs grew by 117% - at an annual rate of 7.8%; and total "outsourced" jobs grew by 56% - at an annual rate of 3.8%.

-New foreign direct investment (FDI) in the U.S. totaled $82 billion in 2003, over twice the amount from the previous year.

-In 2003, U.S. subsidiaries reinvested $38.6 billion in their U.S. operations.

-U.S. Subsidiaries have spent $29.6 billion on U.S. research and development activities.

More here.

Kauffman Foundation: A Thinking Foundation

A few months back, Carl Schramm, President and CEO, of the Kansas City-based Kauffman Foundation made an important speech about how Kauffman is becoming a "thinking foundation." There is some good advice in the speech making it worthwhile reading. I would like to call your attention to it.

Download the speech here.

Team Northeast Ohio on Target

A recent Crains Cleveland Business article provides an update on Team Northeast Ohio's activities. The organization is moving forward in a positive fashion in working with regional companies and communities. That is the basic message.

My personal assesment in doing some early on consulting work for Team NEO is that the organization is on target in its development.

More here.

Mohegan Tribe Expands Gaming Nationally

The Mohegan Tribe is looking to capitalize on the success of its Mohegan Sun casino by taking its gambling business nationwide.

The tribe is looking to play a major role in developing and managing an Indian casino near Chicago, and is working with other tribes to open casinos in California and Washington.

"What is our core competency? It is gaming," said Peter Schultz, vice chairman of the Mohegan Tribal Council. He said the Mohegans' "pragmatic sense" could be a valuable asset to tribes just entering the gambling business.

Native Americans have been largely dependent on outside financing from non-Indians to finance and build casinos and resorts. But the 1,600-member Mohegan Tribe has $1.3 billion in annual revenue from the Mohegan Sun, giving it the ability to finance outside projects.

The Mohegans loaned the 8,000-member Menominee Tribe $3.1 million toward a planned $700 million casino development in Kenosha, Wis., about an hour north of Chicago.

The Mohegans also are considering deals with the Cowlitz Tribe for a casino 25 miles north of Portland, Ore., and with the Torres Martinez Band of Cahuilla Indians from Palm Springs, Calif.

More here.

China Seeks More IT Outsourcing

A recent article describes how China is behind India in attracting IT outsourcing work, and how the country seeks more of this business in the future.

Estimates of country market shares are provided.

More here.

House Approves Slots in Pennsylvania

Hoping to stem the flow of gambling dollars to neighboring states, the state's General Assembly approved slot machines in Pennsylvania.

The Pennsylvania House passed the bill by a vote of 113-88, after prolonged debate, and after supporters had defeated numerous attempts to derail it. The Senate on Friday voted 30-20 to approve the bill.

Gov. Ed Rendell made slots and property tax cuts the cornerstone of his agenda Slot profits would provide an estimated $1 billion annually for school property tax cuts, according to proponents. School districts would be required to increase their wage tax by at least 0.1 percent to receive state revenue generated by slots.

Stay tuned for more on this issue. I've been doing a lot of work in Pennsylvania so this will be an interesting one to watch at the local level.

More here.

Cultural Shift Advocated for Cincinnati

"Minimizing the damage already done, or assigning unfair expectations to current initiatives, will do little good. Repopulating our city will take more than a handful of large-scale real estate developments, as important as they might be. It will take real cultural change on all levels."

These are the words of Nicholas Spencer of Cincinnati, who is an advocate for creative class development in Cincinnati. He says that the city needs more than big real estate development projects to get its economy going. He's right. I like his reference to a cultural shift. That is exactly what most cities need to revitalize themselves. They need to re-examine their "values" and their "value."

More here.

Living on Fifty Cents a Day

Here is an interesting human interest story that speaks to the need for economic development to reach both further ansd deeper globally.

Senegal is often considered to have the best chance for development because of its history of stable democratic rule. Since independence from France in 1960, however, Senegal has limped along without much economic spark, relying on peanuts, fish and tourism. A poorly educated population, few natural resources, poor soil and limited rainfall have helped keep more than half the population below the poverty line. What are its short term development options? Build infrastructure, stabilize public health and educate people.

Read more here.