tv Nightly Business Report PBS July 4, 2013 1:00am-1:31am PDT
this is nig"nightly busines report" with tyler mathisen and season season brought to you by -- >> sailing through the heart of historic cities and landscapes on a river, you get close to iconic landmarks, to local life, to cultural treasures, viking river cruises exploring the world in comfort. jobs there america, tension turns to friday's employment report, and what a strong or weak number could mean for the economy, the policy and your investments. mandate delayed, the business community from restaurants to retailers react to the delay of a key provision in the new healthcare law. and turmoil in egypt, the unrest there is impacting oil markets here. we've got a report here from the center of it all, cairo. all that and more tonight on "nightly business report" for wednesday, july 3rd.
good evening everyone. the job market is looking better tonight, just the kind of encouraging news americans like to hear as they gear up for barbecues and fireworks. 1,0 -- 188,000 were hired in ju. most of the new hiring came from construction and small businesses. that could be a good sign for the labor department's labor report that comes out friday. it's an important number investors will watch closely. if strong, it could impact changes in the policy, growth in the u.s. economy and stack market. >> joining us to talk more about jobs and what he expects from the jobs report. mr. cassman, great of you to have joined us today. what is the number you're looking for? we had the adt report that was higher than what some people thought, what are you looking
for friday? >> 150,000 on the payroll count, and i think that would solidify the message that jobs are continuing to grow but at a slower pace. that's consistent with an economy that's not shaken out of the pace of growth every all soft we think the economy is sluggish, jobs are okay and will make the fed's decision as it moves through the september, i think, point at which it will think about tapering tough. >> bruce, besides the headline number, what else is important in this report? we know each of these employment reports are so critical to fed policy and investors, but is there a key element you're look for? >> beyond the job count is unemployment rate and looking at the unemployment rate from jobs versus labor supply. we are certainly hoping that there is better news again after last month's report on labor supply that keeps stealing their work and entering the work force. i think after that you want to
look at the composition. we had a weak service sector survey today. we want to see service sector jobs, which have a been a bright spot this year continue to hold up that would be a concern if it didn't. then you look at the income side, which is important, see the labor income, the workweek, wage number and alongside the job gains. >> a moment ago you said your prediction was 150,000 payroll jobs added in the most recent month and that would make it very difficult for the fed to begin pulling back from the stimulus in september. i don't mean to put words in your mouth, i'm of then accused of doing that better than anything else i do, but i assume that's a goldie locks number, not too hot, not too cold that would be good for the stock market. >> generally speaking yes, though i don't try to be too precise in understanding where the market is going. 150,000 is an okay number. it's not where we want to be. it's not where the fed wants us
to be but certainly not the slipping we saw in both the spring of 2011 and 2001 whe12 wt looked like business was pulling back. it's in the middle. over time i think we would like to see stronger job growth, stronger growth overall and a fed tapering in response. overall strength would be good here, but certainly, the response people would expect from the fed has and will continue to put jitters through the market. >> you just said you want to see stronger job growth. everybody wants to see people getting jobs, it's good for the economy. what's taking so long? >> we talk about how auto sales are doing better, construction, retail, how much more do we need to get companies hiring again? >> you're making an interesting point. we're seeing strong news in the auto industry and strong news in housing and construction, but i think we're being held back by a fiscal drag that is still pretty intention. i think we're being held back by a global economy that is still
pretty weak and the balance of this is giving us something that's -- i guess i call it lackluster, nothing terrible but nothing exciting. we would like to see things move better and there is hope that the drags, at least on the fiscal side will fade, but that's still a forecast. it doesn't look like where we are now. >> bruce, thanks for joining us on this holiday shortened trading day and have a good 4th of july. still ahead on the program, why do american businesses complain about a shortage of skilled workers, even though so many people are looking for work? we'll look at what is being done about that. well traders worked a short day on wall street today with the markets closing early ahead of the 4th of july holiday, and today's session proved one thing, jobs matter more than just about anything else. those encouraging data about jobs we told you about at the top of the program were enough to lift stocks today. the adp numbers counter acted a
trade deficit to 40 billion and the market put past services that was the weakest since february of 2010 and the turmoil in port gill and egypt that sent prices higher. we'll get to that in a moment. the dow added 56 points, the nasdaq up 10 and the s&p 500 gained a point. more on oil prices that tyler was just talking about. they are now at the highest level in 14 months, 101.$101.24 barrel. investors and traders bid up prices on growing worries of a disruption of crude supply in the middle east because of the political uncertainty in egypt. egypt controls one of the busiest shipping lanes. for the latest out of egypt, we have this report. >> reporter: another day of protest calling on president mohamed morsy to step down after
just one year in power. the deadline, 48 hours expired today for the government to figure things out, and that would have included a power sharing deal with the opposition. that didn't materialize. what happened then, the military is sitting down with leaders from the political team, from the religious team, national leaders to come up with a road map. in the meantime, the government put out a statement on president mohamed morsy's facebook page saying it's dangerous to undermine the la get ma see of a freely elected government and had to be made in terms of reconciling with the opposition. it shows how the military moves further and further apart from the government raising the risk and stakes for egypt and everybody else watching around the world. of course, there is a heightened state of alert for the amy. tanks are moving into various parts of the city, not in large scale but selectively. for "nightly business report" in
cairo. that report is his latest filing and just a reminder that the situation in egypt is fluid, things are changing minute by minute. administration decision announced late yesterday to delay key provisions of the afford care about known formally as obamacare hit with a force of a thunder crab. bertha coombs explains what the delay means for employers, employees and the future of the law. >> reporter: groups like the national retail federation have been raising the red flag for months about employ ehrmann date situations under the affordable care act but the decision to push it back surprised him. >> it was evident, administration wasn't ready, we weren't ready and not going to be ready in type for this to take off in october when the exchanges start enrolling people and then january, when the
exchangers are supposed to open the door. >> reporter: restaurants and retailers with more than 50 full-time employees are the businesses that have been feeling the most pressure to compile with the mandate or face fines starting at $2,000 per worker for failing to do so. some haven't offered insurance in the past but the nrs believes many will continue with coverage plans on the books for 2014. though some may opt to offer plans with fewer rich benefits than mandated. insurers should see little impact on enrollment. >> what it does, though, is brings back to the front the uncertainty that we have around obamacare and affordable care act. >> reporter: it's the second time the obama admission station came and pushing back the small business insurance marketplace on the federal health exchanges for one year, as well.
>> you've seen two small changes here and the next step is to come to the conclusion but tby administration. >> reporter: the implications would be negative if the administration delays the individual mandaterequiring americans to be insured. >> that would be a major problem or concern for the insurance industry because you would be seb jekt to selection where the sickest people get the insurance through the exchanges next year but those who are healthy will opt out. >> reporter: because stakes are so high, analysts don't seed administration putting the individual mandate on hold, but the clock is ticking. with aca open enroll the set to begin in less than three months. for "nightly business report," i'm bertha coombs. >> let's hear more about the impact of this delay on american businesses.
neal, what did you hear from the membership today? what will they do next with this extension? >> i think first they will take a deep breathe and reevaluate where they are. this announcement last night, bo surprised and pleased us. i think there is a sense that we were careering towards a deadline and i think there was some danger that we were going to get sideways on this. so i think we're very encouraged. >> put into perspective for me, if you would, neal, the number of businesses that would be affected by this employ ehrmann date and now won't be. i understand it's like 97% of all businesses in the country have fewer than 50 employees anyhow, and most of the businesses above 50 employees, full-time employees that is already provide insurance. so what number of businesses are
we talking about? >> it's actually a large percentage of the employees are in those larger than 50 employee groups. we have a lot of members that are in that small mom and pop range, as well, but they still had to report to the exchange all the information that was so trouble some in yesterday's announcement. really, the challenge is not -- it's the sufficiency of coverage, although many firms offered coverage before, it's often not as comprehensive as the affordable care act would require, and there is a real question about the relative size of employer contribution to individual employee income. there's a second penalty under the aca that penalizes when it passes a certain income threshold. so i think this is a broad concern to a wide swath of the
business community, certainly the retail industry and chain restaurant industries that i represent have been very worried about this, and it's introduced an element uncertainty and to expansion plans. >> when you talk about uncertainty, it goes beyond the businesses that have to deal with this new legislation. we hear that individuals are still very confused. a lot of these exchanges are not setup yet. bertha said in that package, whether or not this individual mandate will have to be postponed. you're in touch with everything going on in this bill. what do you think? is that the next extension we'll hear about? >> i kind of doubt it. i think this was a big step for administration to take, to postpone the employer responsibility, mandate regime. i think to go that extra mile, not to open up the exchanges for individuals, you might see a compliance light sort of an approach still on the individual
side, but i think they will try to enroll individuals and they have already encouraged employers to continue to provide and expand offering to employees. >> all right. neal, thank you so much for coming on and sharing this information with us. >> thank you. neal truckline. back to the future, can google's motorola mobilitity shake up the short phone market now? first how some of the most widely held stocks closed today.
as we mentioned earlier, events in egypt are very fluid and now egypt's military chief says the president has been placed by the chief justice of the constitutional court and the constitution has been suspended. the islamist constitution and say as new cabinet will soon be formed. there is a new or more accurately player in the smart phone wars and has a familiar name, motorola, motorola mobilitity is owned by google, luring customers away from apple and samsung devices. jon fortt has more now. >> reporter: call it a shot across the bow of a smart phone industry. google through motorola putting america on notice that a ground breaking new phone is coming. the full page add ran in this morning's new york times usa
today, wall street journal washington post. takes full advantage to the holiday. it's a tease, we don't see the phone. the company hinted we'll see this month or next. what we do see the biggest brand of the internet era trying to take the first. >> if you're google or motorola you need a fantastic product out the door. consumers are unforgiving with technology. you have one shot to get it right. >> reporter: at a conference in may motorola ceo said it will be more self-aware than other phones. it will know when it's in your pocket, when you want to take a picture. it will face tough competition from two of the most dominant companies in tech, samsung and apple. apple's new iphone expected within three months with new software. >> this is what matters. >> reporter: there's a bit of a marketing face off here, too.
apple had the designed in california signature, not everyone is impressed. the commercial mostly features people in everyday situations using apple products in slow motion. in a way, to the think back different complain when apple tried to reintroduce itself to the world. >> the think different campaign, that's something we think of as typically apple. i mean, the celebration of the crazy ones, for example. the whole different drummer kind of theme. i don't see anything in this new campai campaign. there are a bunch of people who seem to be enjoying apple products in a number of contexts, and pretty cliche context at that. >> reporter: this time it's google and motorola that are trying to get people to think different since in the smart phone era thinking the same means they will buy from apple or samsung. for "nightly business report,"
i'm jon fortt. employees at facebook made so much money from the initial public stock offering last year that where they live and work is the richest in america. the labor department says residents in the california county made an average of $3,240 a week during the fourth quarter of last year, that rounds out to $168,000 a year, more than residents in manhattan, which is the second highest paid county. the market focus on a short trading day. alcoa lead and jp morgan cut on that company because of weak prices for aluminum. shares touched a four-year low. alcoa launches on monday and we'll speak with the ceo after those numbers are released. at the close alcoa was down more than 1% at $7.71. johnson the nutrition firm lead the s&p 500 as china probes whether baby formula companies
conspired to fix companies, made johnson down the most losing more than 8%. it closed at $68.85. auto nation a big gainer today, thanks to revved up car sales. it reported new vehicle sales up 5% in june, and 7% for the second quarter. auto nation is the country's largest seller of new and used cars. the stock rose more than 1.5% to close at $45.27. so far this year, shares up 14%. chipolte was the biggest gainer increasing to $430 a share. they closed at $384 and change. creating jobs is an on going change in the u.s. to put it mildly, especially in the man e
fracturering sector and it's challenging the economics of a traditional education. >> reporter: sherwood is known as a fast growing southern city home to nascar and some of the biggest banks. what it's probably not known at all for is the 200 german companies who call the city home and are on the edge of helping solve an economic problem. why with the unemployment rate so high do they lack skilled workers. mixing together government, business, education and technology, and it's helping spark a resurgence of man talk tearing. this is the biggest manufacturing plant building steam and gas turbines to generate electricity. when manufacturing employment is challenged in the u.s., this doubled the number of jobs in the past two years to 1,550 but that's easier said than done. >> there is plenty good people that have basic skills, it's
just that we don't have them trained in the modern advance manufacturing skills we need for today. >> reporter: that's where the german connection comes in. these companies brought their apprenticeship program and connected with colleges like central piedmont to train workers, old style. >> they have a proven system for over a couple thousand years called an apprenticeship program and they help students determine what they want to do in their career early on. >> learning how to run machines. >> reporter: this 18-year-old joins the program after two years in the program that includes working with mentors, she'll have an associate degree and a guaranteed job. it cost $170,000 to train workers like her. she's one of 15 in the program, including three veterans, public funds pay part of the cost and they pay the rest. at the end the company gets a skilled worker and she gets a
job, which can be tough for graduates in today's economy. for "nightly business report," i'm steve leaseman. coming up, after a rough few years, a demand for private planes is taking off, but is the industry going to hit turbulence? but first how treasuries, commodities faired today. the planned merger of american airlines and u.s. airways is facing an anti trust suit. it was filed in san francisco on behalf of 40 consumers. it claims the combined airline would amount to lower flight load, lower quality of service
and higher ticket prices and the merger means four airlines, united, dealta southwest would control the flights. if traveling commercial airlines is not yur taste, expensive, not attractive, you can do what tens of thousands of others do and that is fly their own planes. as jane wells shows us, the business of private airplane ownership is taking off fast. >> we only need a 40 foot hanger to put it in. >> reporter: the private airplane business appears to be taking off. >> i've been looking at planes for a year and i have my pilot license so i want to get the plane i'll fly. >> we have the biggest backlog that we've had since 2007. >> reporter: general aviation can run from $130,000 to 6 million. sales went to $19 billion. >> we went through pretty difficult years, but cirus is
innovative. we've not sat continuing to build the airplane the same way five or six years ago. >> reporter: two years ago the minnesota-becaused company was bought by a china owned company that infused it with cash. cirr us began hiring. they have a 65 diameter parachute that can be deployed for emergency landings and credited with saving 70 lives. a new seven to eight passenger-like jet is scheduled for late they are year. sales overall in the first quarter showed a market improvement according to the industry. the number of planes shipped jumped 10% and billings took off 42% to $4.6 billion. cessna is the leader and aven aviation consultant said it's not all clear skies. buying a plane is one thing,
keeping it is another. >> we see about 30,000 recreational airplanes from small jets to cubs coming out of the system in the next five years because of cost and fuel and other things. >> reporter: add to that hopes by the president to reduce tax breaks for private plane's use for business and the flight plan for growth could hit turbulence, just as it was starting to regain altitude. and finally tonight, the statute of liberty closed since super storm sandy flooded liberty island back in october will reopen to the public tomorrow, just in time to celebrate the 4th of july. officials are bracing for big crowds to visit the monument because it had been closed for more than a year to make repairs and reopen just a day before that storm hit. and for a woman whose nearly 127 years old, lady liberty looks pretty good, isn't she tyler? >> always does, always does. >> that's "nightly business report" for tonight, thanks for
watchi watching. >> we'll be here tomorrow night for a special edition of "nightly business report." hope you join us. have a great night everybody. "nightly business report" has been brought to you by -- >> sailing through the heart of historic cities and landscapes on a river you get close to iconic landmarks, to local life, to cultural treasures. viking river cruises, exploring the world in comfort.
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