The Federal Reserve Bank of Kansas City, the part of the nation's central bank that covers the tenth district, noted an overall burst in hiring during October. The most recent monthly Kansas City Fed market research report indicated that 240,000 jobs were added throughout the district, including 19,000 manufacturing jobs—the most since February. Although the increase in new jobs is good news for the manufacturing industry, the industry report also noted areas that need improvement.
Experts had previously estimated that the government shutdown would have a negative impact on job growth throughout the country. However, market research reports indicate that job growth in the tenth district wasn't affected. According to a recent article on the Kansas City Star website, the overall hiring boost in October was a pleasant surprise. Now economists are predicting that overall job growth should remain healthy in the upcoming months and even pick up next year. But, many people are still wondering what the future has in store for the manufacturing industry.
The Kansas City Fed's industry report surveys manufacturing businesses throughout Kansas, Nebraska, Colorado, Oklahoma, Wyoming, northern New Mexico, and western Missouri. The most recent report indicated that manufacturing companies in the area are still finding it difficult to find general laborers. Throughout the district, manufacturing companies have positions available that pay between $9.50 and $12.50 per hour, but people aren't applying for the jobs. Not only are manufacturing companies in the tenth district struggling to find employees, they are losing employees to oil and gas businesses, which can afford to pay higher wages.
According to Chad Moutray, Chief Economist for the National Association of Manufacturers, hiring in the manufacturing industry is still disappointingly low. Throughout the nation, production isn't increasing as quickly as experts would like to see it increase, and market research reports indicate that consumers are still cautious about spending.
Manufacturers in the tenth district who took part in recent market research reports indicated that they are also receiving more notices of impending price increases. The price increases are a result of increased demand and higher labor costs. Unfortunately, price increases won't help the industry's job growth, because companies in need of employees won't have the budget to pay higher hourly wages.
While there's still a lot of room for improvement in the manufacturing industry, the recent market research reports weren't filled with only bad news. While manufacturing was affected by the sixteen-day government shutdown—partly because production was slowed on direct production government contracts—the industry still managed to fill 19,000 jobs. The increase in hiring is great news, and economists believe that manufacturing companies will continue to hire new employees at a steady rate throughout the end of the year. Hopefully, the next batch of market research reports released by the Kansas City Fed show that job growth is increasing.
(Photo courtesy of freedigitalphotos.net)
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