MANUFACTURING UPDATE

- October 2015 -

1. LATEST POLICY

==================================

Peters Remanufacturing Bill Signed into Law by President

President Obama has signed into law legislation introduced by U.S. Senator Gary Peters, the Federal
Vehicle Repair Cost Savings Act, which requires federal agencies to encourage the use of
remanufactured parts in federal vehicle repairs when doing so lowers costs, maintains quality and
performance and does not compromise safety.
Maintaining the federal vehicle fleet is a nearly $1 billion annual expense, and promoting the use of
remanufactured parts for repairs helps cut costs and ensure tax dollars are being used efficiently, said
Senator Peters. Im proud that the first bill I introduced in the Senate has been signed into law by the
President. This commonsense, bipartisan law will help reduce wasteful spending and support Michigans
growing remanufacturing industry.
Peters introduced the legislation with Republican Senator Jim Lankford (OK), and Congressman Bill
Huizenga (MI-2) introduced companion legislation in the House of Representatives.
More: Peters Release

Murphy Introduces 21st Century Buy American Act to Support American

Manufacturers

While visiting Ansonia, Connecticuts American Precision Manufacturing, U.S. Senator Chris Murphy (DConn.) announced the introduction of his 21st Century Buy American Act. The 21st Century Buy
American Act will strengthen existing Buy American standards to ensure that the U.S. government
prioritizes the purchase of American-made goods. The legislation will comprehensively reform the
outdated Buy American Act, which was signed into law more than 80 years ago.
More: Murphy Release

Warner, Portman, and Collins Bill to Provide Regulatory Relief for Businesses
and Workers Advances in the Senate

U.S. Senators Rob Portman (R-Ohio), Mark Warner (D-Va.), and Susan Collins (R-Maine) announced that
their bipartisan legislation requiring independent agencies to analyze the costs and benefits of new
regulations and tailor new rules to minimize unnecessary burdens on the economy has passed out of the
Senate Homeland Security and Governmental Affairs Committee. Portman and Warner are the coauthors of this legislation and Collins is an original cosponsor.
More: Warner Release

Trans-Pacific Partnership Is Reached, but Faces Scrutiny in Congress

The United States, Japan and 10 other Pacific Rim nations on Monday reached final agreement on the
largest regional trade accord in history, teeing up what could be the toughest fight President Obama will
face in his final year in office: securing approval from Congress.
More: New York Times

Statement by the President on the Trans-Pacific Partnership

I've spent every day of my presidency fighting to grow our economy and strengthen our middle class.
That means making sure our workers have a fair shot to get ahead here at home, and a fair chance to
compete around the world. My approach to trade has been guided by a unifying principle: leveling the
playing field for American workers and businesses, so we can export more products stamped Made in
America all over the world that support higher-paying American jobs here at home.
More: White House Release

House Bipartisan Petition Forces Vote on Ex-Im Bank Reauthorization

A majority of House lawmakers took a rare procedural move to force a vote later this month on
reauthorizing the U.S. Export-Import Bank, a blow to conservative Republicans who want to close the
trade bank.
More: Wall Street Journal

The Largest Apprenticeship Investment in U.S. History

Since Day One, the Obama administration has been focused on building a training and workforce system
that serves job seekers and job creators alike. Were empowering people with the tools to punch their
ticket to the middle class, while giving employers a pipeline of skilled workers so they can grow and
compete in the 21st-century economy.
More: Department of Labor Release

Senators Baldwin, Coons Recognize National Manufacturing Day on Senate Floor

WASHINGTON U.S. Senators Tammy Baldwin (D-Wis.) and Chris Coons (D-Del.) spoke on the Senate
floor to recognize National Manufacturing Day. Senator Al Franken (D-Minn.) also joined Senators Coons
and Baldwin on the floor in support. National Manufacturing Day occurs on the first Friday of October
every year and is a celebration of modern manufacturing meant to inspire the next generation of
manufacturers.
More: Baldwin Release

2. OTHER NEWS

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On National Manufacturing Day, U.S. Industry Nears Upswing

Though recent industrial data have left little room for celebration among U.S. manufacturers, scores of
production plants across the country are switching up their daily routines Friday, opening factory doors
to students, parents and politicians in recognition of National Manufacturing Day.
More: U.S. News & World Report

U.S. Commerce Secretary Visits Delaware Manufacturers

When asked what attracts young people to careers in manufacturing, Hodgson Vo-tech senior Anthony
Dominelli offered his own experience. Honestly, I never heard of a millwright until I went to school at
Hodgson, he said. But now I love it and its what I want to do for a living.
More: Delaware Online

Senator Stabenow Celebrates Manufacturing Day With Local Students at Detroit

Manufacturing Systems
In celebration of Manufacturing Day, U.S. Senator Debbie Stabenow delivered remarks at Detroit
Manufacturing Systems, which opened its doors to hundreds of students, parents and educators on
Friday, October 2. School groups had the opportunity to tour the plant and learn about career
opportunities in manufacturing.
More: Stabenow Release

ICYMI: Senator Coons oped: Manufacturing Can be Transformed in Delaware

Almost every day, I ride Amtrak between Wilmington and Washington, D.C., and each day out the
window, I see the site of the old Chrysler plant in Newark. Each time I see it, I think about being there 15
years ago when I first ran for public office, introducing myself to thousands of hard-working employees.
Some of those men and women had just graduated from high school and others had been there for
decades, but they all shared one thing in common: they had good-paying, steady manufacturing jobs.
More: Coons Release

On National Manufacturing Day, Senator Gillibrand Tours Defelsko Corp; Pushes

for New Legislation to Boost Advanced Manufacturing & Workforce
Development

U.S. Senator Kirsten Gillibrand marked National Manufacturing Day and toured DeFelsko Corporation.
Friday [was] National Manufacturing Day, a celebration of modern manufacturing intended to inspire
young Americans to learn STEM skills and pursue careers in advanced manufacturing.
More: Gillibrand Release

On Senate Floor, U.S. Senator Tammy Baldwin to Deliver Call to Action for
Wisconsin Manufacturing

On the Senate floor, U.S. Senator Tammy Baldwin use[d] the kick-off of National Manufacturing Day and
Wisconsin Manufacturing Month to deliver a call to action for our manufacturing economy.
More: Baldwin Release

Senator Coons, Representative Massie highlight Problems With Patent Reform

Bills in Google Hangout Event

Today, U.S. Senator Chris Coons (D-Del.) and Representative Thomas Massie (R-KY) participated in a
bipartisan online Google Hangout to discuss their concerns with patent legislation (S. 1137 and H.R. 9)
currently under consideration in Congress. Patent expert Gene Quinn moderated the discussion and the
members took questions from online viewers via Twitter.
More: Coons Release

Blumenthal, Murphy, Courtney, Applaud $6 Million from U.S. DOL to Fund

Eastern Connecticut Manufacturing Pipeline Initiative

U.S. Senator Richard Blumenthal (D-Conn.), U.S. Senator Chris Murphy (D-Conn.) and Congressman Joe
Courtney (D-2) today applauded $6 million in federal funds from the U.S. Department of Labor to
support the Eastern Connecticut Manufacturing Pipeline Initiative.
More: Blumenthal Release

Senator Markey, Mayor Walsh Announce $3 Million Federal Grant to Support

Construction and Hospitality Careers

Friday, October 2, 2015 - Mayor Martin J. Walsh and Senator Edward J. Markey today announced a $3
million grant from the Obama Administration to expand apprenticeship opportunities in construction
and hospitality through the Mayor's Office of Workforce Development. The City's award, part of the
$175 million American Apprenticeship Grant program, will serve 394 participants seeking to advance
careers in the construction and hospitality sectors.
More: Markey Release

Following Job Loss at Lima's Joint Systems Manufacturing Center, Brown,

Portman, and Jordan Announce More than $3 Million in Federal Resources to
Support Manufacturing in Allen County

WASHINGTON, D.C. U.S. Sens. Sherrod Brown (D-OH), U.S. Sen. Rob Portman (R-OH), and U.S. Rep. Jim
Jordan (R-OH-4) today announced that, following their letters in support of Phase Two grant funding for
Allen County, the U.S. Department of Defenses Office of Economic Adjustment has awarded $3,013,590
to the county. Allen County qualified for this grant due to job loss at the Joint Systems Manufacturing
Center (JSMC) in Lima.
More: Brown Release

Cardin, Mikulski, Delaney Announce More Than $600,000 in Federal Funds to

Educate Hagerstown Community College Students in Advanced Manufacturing

U.S. Senators Ben Cardin and Barbara A. Mikulski, together with U.S. Representative John Delaney (all DMd.), today announced that the National Science Foundation (NSF) has awarded the Hagerstown
Community College (HCC) $617,648 to support the development of a new advanced manufacturing
technology degree program, an industrial technology certificate program and a basic electronics
certificate program.
More: Cardin Release

The $100,000 job: Be an Apprentice

Mike Taylor may represent the bridge to America's job skills gap. He went to a 4-year college and then
waited tables at a restaurant even as he struggled to pay off college loans. Two years later, he did what
many Americans are doing less and less: he became an apprentice.
There are 5.8 million job openings in the United States -- a record high number. It's a positive, and
indicates that companies are hiring. But hidden behind the huge number of job openings is the fact
many Americans don't have the skills to fill them.
More: CNN

3. SECTOR DATA

==================================

Purchasing Managers Index (PMI)

The September PMI registered 50.2 percent, a decrease of 0.9 percentage point from the August
reading of 51.1 percent. Economic activity in the manufacturing sector expanded in September for the
33rd consecutive month, and the overall economy grew for the 76th consecutive month.
The PMI is a widely watched measure of aggregate manufacturing strength. The PMI is based on a
survey that asks purchasing managers if Inventories, Supplier Deliveries, Employment, Production, and
New Orders have gone up or down that month. Results above 50 indicate growth.
For September, Inventories read 48.5 (no change from August), Supplier Deliveries read 50.2 (-0.5%),
Employment read 50.5 (-0.7%), Production read 51.8 (-1.8%), and New Orders read 50.1 (-1.6%). This
data is in chart form below.
% Change on
prior month
PMI
50.2
-0.9
Inventories

48.5

0.0

Supplier
deliveries

50.2

-0.5

Employment

50.5

-0.7

Production
New orders

51.8
50.1

-1.8
-1.6

More: Institute for Supply Management

Employment

Preliminary estimates by the Bureau of Labor Statistics show that manufacturing employment was down
9,000 in September, at a seasonally adjusted 12.318 million.

Manufacturing employees, millions

The below chart shows the total number of manufacturing employees over the last ten years in millions
of workers, as well as the month-on-month change in manufacturing employment for the last six
months (in thousands). Both numbers are seasonally adjusted.
Month-on-month change, thousands

15

0
14

+6

+1 +11

-18 -9
Apr May Jun Jul Aug Sep

13
12
11
'05

'06

'07

'08

'09

'10

'11

'12

'13

'14

'15

More: Bureau of Labor Statistics

Federal Reserve Data

The Fed publishes monthly data on industrial production and capacity utilization. Industrial production
is represented as an index where the 2007 level equals 100. Capacity utilization is shown as percent of
capacity. The chart below shows these measures for the last six months.

Manufacturing
production

100

106

105.3 90

104

80
75.8

102
100

70
60

Mar

April
May
June
July
Aug
Manufacturing production
Manufacturing capacity utilization

Manufacturing capacity
utilization (%)

108

More: Fed
In addition to the Feds national data, six of the twelve Federal Reserve regional branches publish
monthly updates on manufacturing conditions in their region. Because each branch uses different
questions and methodology, interregional comparisons are not suggested.

New York Fed (NY state, 12 northern NJ counties, and Fairfield County in CT)
The October 2015 Empire State Manufacturing Survey indicates that business activity declined for a
third consecutive month for New York manufacturers. The headline general business conditions index
edged up three points, but remained negative at -11.4.
More: NY Fed
Philadelphia Fed (eastern PA, southern NJ, and DE)
Manufacturing conditions in the region continued to weaken in October, according to firms responding
to this months Manufacturing Business Outlook Survey. The indicator for general activity remained
negative, while the new orders and shipments indexes turned negative this month.
More: Philadelphia Fed
Richmond Fed (DC, MD, NC, SC, Virginia & most of WV)
Fifth District manufacturing activity slowed in September, according to the most recent survey by the
Federal Reserve Bank of Richmond. Order backlogs and new orders decreased, while shipments
declined.
More: Richmond Fed
Chicago Fed (southern WI, IA, northern IL, northern IN, and southern MI)
In December 2013, the monthly release of the CFMMI was suspended pending the release of updated
benchmark data from the U.S. Census Bureau and a period of model verification.
More: Chicago Fed
Kansas City Fed (western MO, NE, KS, OK, WY, CO & northern NM)
Tenth District manufacturing activity declined at a similar pace as in previous months, while
expectations for future activity dropped considerably. Producers continued to cite weak oil and gas
activity along with a strong dollar as key reasons for the sluggish activity
More: Kansas City Fed
Dallas Fed (TX, northern LA and southern NM)
Texas factory activity was essentially flat in September, according to business executives responding to
the Texas Manufacturing Outlook Survey. The production index, a key measure of state manufacturing
conditions, remained near zero (0.9), suggesting output held steady for a second month in a row after
several months of declines.
More: Dallas Fed

U.S. Manufacturing Technology Orders (USMTO)

August U.S. manufacturing technology orders totaled $285.92 million, down 10.2% from Julys $318.48
million and down 21.2% when compared with the total of $362.65 million reported for August 2014.
With a year-to-date total of $2,771.23 million, 2015 was down 10% when compared with 2014.
While there is a sense of unease in manufacturing now as indicated by this reduction in orders
combined with drops in the PMI and industrial production, some leveling after a period of strong growth
is expected and helps build stable longer term growth, said AMT President Douglas K. Woods. We are
a diversified industry, and pockets of manufacturing continue to show resilience, such as automotive
stamping and medical devices. While there is some cause for caution, we do not anticipate more than
market flatness into the early part of 2016.

These numbers and all data in this report are based on the totals of actual data reported by companies
participating in the USMTO program. The chart below shows year-over-year change and total August
2015 orders on a national and regional basis. Fields marked n/a denote where, due to changes in the
make-up of survey participants, an accurate reflection of the data is not available.
Year-over-year
August
change (%)
orders ($m)
Total
Northeast

285.9

-10.2

51.0

-22.3

Southeast

18.9

North Central-East
North Central-West
South Central

79.3

-8.0

51.1

-11.0

n/a

-46.9
West

45.4

n/a

46.0

More: Association for Manufacturing Technology

4. ABOUT THIS NEWSLETTER

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This update is provided by the Office of U.S. Senator Chris Coons on behalf of the Manufacturing Jobs for
America initiative. For more information, visit coons.senate.gov/manufacturing or email
Peter_Winter@coons.senate.gov.