Jobs, manufacturing, and exports are areas of Missouri’s economy that have shown great strength in the past year, Department of Economic Development Director Kelvin Simmons reported recently.
At a press conference last Wednesday, Simmons pointed out that 42,600 jobs have been added since January, ranking the state 15th in the country. On a percentage basis, the state’s growth rate is higher than the national rate.
He added that Missouri is within 34,500 jobs of reaching the state’s highest employment level that occurred in June of 2000, as part of the economic boom of the late 1990s.
“If we have the same level of job growth in 2005 that we have had in 2004, we will reach record employment by this time next year,” Simmons said.
Missouri’s manufacturing trends also continue to outpace the country, according to the conditions report, and one of the reasons for the job growth. Between November 2003 and November 2004 the state added 4,500 manufacturing jobs, ranking it third in the nation; on a percentage basis, manufacturing growth is more than four times the nation’s rate.
“This is good news because manufacturing jobs are extremely important to our economy,” explained Simmons. “Even though manufacturing makes up only 11 percent of our total employment, these kinds of jobs tend to be higher paying and have a greater impact on the overall economy of the regions where they are located.”
Contributing to Missouri’s manufacturing strength is a sharp increase in exports. A recent report by the World Institute for Strategic Economic Research, comparing the first three quarters of 2003 with the first three quarters of 2004, showed that Missouri exports grew by 35 percent and $1.734 billion, ranking the state sixth in the country.
“Our focus on making Missouri businesses more competitive in the global economy is part of the foundation we have built that should lead to sustained economic growth in the years ahead,” Simmons said.
As a result of the strong local partnerships across the state, Simmons said DED has identified 96 companies that have announced expansion and relocations over the past year that will lead to private investment of more than $1.2 billion. In addition, another 14 companies have indicated expansion projects that have not yet been announced, totaling more than $607 million in private investment. “What that means is we have close to $2 billion in private investment that has either started or will occur over the next few years to stimulate Missouri’s economy and create and retain thousands of jobs,” Simmons said. “This certainly reflects well on our business climate, the skills of our workforce, the strength of our communities, and the quality of life that we have.”
Simmons expressed concern about the recent hike in the unemployment rate, which on a seasonally adjusted basis was 5.8 percent in November, up four-tenths from October. “Certainly this concerns us and the increase in the rate over the past few months represents a cloud on what is otherwise a sunny economic picture,” said Simmons. “We are watching this closely and anticipate the trend will soon change.”
He said the increased unemployment rate reflects the impact of layoffs in major industries like transportation and airlines. Also, when the employment picture begins to brighten, individuals who had not been seeking jobs become encouraged to start looking again and are counted in the total labor force. Until they find jobs, they are counted as unemployed.
Another indicator included in the report is personal income. Missouri’s personal income growth for 2003, the latest data available, shows the state’s growth is equal to the nation’s rate of 3.2 percent.
Ameren Pledges $1 Million to University of Missouri-Columbia College of Engineering
ST. LOUIS, (PRNewswire) December 26, 2004 – St. Louis-based Ameren’s $1 million pledge will finance equipment for the MU College of Engineering’s electrical and computer engineering “capstone” laboratory.
Senior engineering students work in teams for nine months on their final “capstone” projects, which involve solving challenging problems and demonstrating their results. This funding will give students and faculty access to specialized and expensive equipment — like a more powerful spectrum analyzer and hardware and software required for building printed circuit boards. University officials say students need this equipment to build “real-world” projects on a professional level.
In a statement, Gary L. Rainwater, chairman, president and chief executive officer of Ameren Corporation, said, “As a Missouri-based corporation with century-old roots in this state, we are committed to strengthening educational opportunities for Missouri’s residents.”
“Our goal is to help create a well-educated, experienced class of young professionals who can replace the soon-to-be retired Baby Boom population of highly experienced experts. We support education through a number of programs, and today we are adding to that support with significant funding to enhance the excellent programs of the College of Engineering at Missouri’s flagship public campus,” said Rainwater.
“The right equipment and environment are critical in supporting engineering students in building more marketable, professional-caliber products for their capstone projects,” stated James E. Thompson, dean of the College.
Tenet Completes Sale of Two St. Louis Hospitals
ST. LOUIS, (BUSINESS WIRE) December 26, 2004 – Tenet Healthcare Corporation has completed the sale of two acute care hospitals in St. Louis to Argilla Healthcare, Inc. The hospitals are Forest Park Hospital, a 450-bed acute care hospital, and St. Alexius Hospital, consisting of St. Alexius Hospital – Broadway Campus, a 203-bed acute care hospital, and St. Alexius Hospital – Jefferson Campus, a 408-bed specialty facility.
Net after-tax proceeds, including a $6 million note from Argilla Healthcare, Inc. and the liquidation of working capital, are estimated to be approximately $45 million. The company expects to use the proceeds of the sale for general corporate purposes.
The two St. Louis hospitals are among 27 hospitals Tenet announced it was divesting on Jan. 28, 2004. With today’s announcement, Tenet has completed the divestiture of 13 of the 27 facilities and has entered into definitive agreements to divest an additional nine hospitals. Discussions and negotiations with potential buyers for the remaining five hospitals slated for divestiture are ongoing.
Coors Pulls TV Ads From CBS That Compared Aspen Edge to Michelob Ultra
ST. LOUIS, (PRNewswire) December 26, 2004 – Coors Brewing Co. has pulled off of CBS television ads for its Aspen Edge brand that compared it to Anheuser-Busch’s Michelob ULTRA, Anheuser-Busch has learned. The ads are misleading and make unsubstantiated claims about consumers’ taste preferences, according to Anheuser-Busch.
Anheuser-Busch alerted Coors of its concerns about the ads that mention Michelob ULTRA on Nov. 12. Anheuser-Busch later filed a challenge with CBS, and has been notified that, in response to the challenge, Coors has decided to pull the ads.
“Competition is the lifeblood of American business, but companies like Coors and SABMiller are now on notice that we will fight for truth in advertising,” said Michael J. Owens, vice president of sales and marketing for Anheuser-Busch, Inc.
In the past week, SABMiller has had several of its ads pulled by three major TV networks – ABC, NBC and CBS. Anheuser-Busch challenged these ads for making unsubstantiated claims about taste preference regarding the company’s Bud Light brand, the best-selling light beer in the world, and for unfairly disparaging Anheuser-Busch brands. Two networks pulled three SABMiller ads off the air, while another pulled five spots.
Bud Light continues to grow and has gained share on Miller Lite since the ads began airing, according to case-share data from IRI. Sales for Michelob ULTRA have been on record pace since its national rollout in September 2002 – supermarket data shows that the brand has achieved a 2.9 percent share of the beer industry, according to Information Resources Inc.
Price of Heating Fuels and Gas Drop
JEFFERSON CITY, (SLFP.com) December 26, 2004 – Despite recent cold weather, the price for natural gas and propane for space heat are slightly lower than a month ago, according to a survey released today by the Missouri Department of Natural Resources’ Energy Center.
U.S. natural gas supplies were estimated at 3,150 billion cubic feet (Bcf) as of Friday, Dec. 10. U.S. supplies are currently 14.3 percent higher compared to the 5-year average. Natural gas futures price at the NYMEX closed at $6.82 per MMBtu on Dec. 22 compared to $7.28 a month ago and $6.75 at this time last year, the Energy Center reported in its Dec. 23 edition of the Missouri Energy Bulletin.
U.S. propane supplies are 3.76 million barrels higher compared to last year at 58.8 million barrels. Missouri’s average retail price for propane fell $0.03 per gallon during the last month to $1.53 per gallon on Dec. 20. However, prices were $1.23 at this time last year, an increase of 25 percent.
The Missouri retail price for regular gasoline decreased 17 cents per gallon from last month, standing at $1.60 per gallon as of Dec. 20 but continues to be over 20 percent higher than this time last year. The average retail price paid for regular unleaded gasoline in the United States was $1.82 per gallon.
Retail gasoline prices are falling throughout the United States due to strong gasoline production and imports, stronger supplies of gasoline in storage, which stand nearly 8.4 million barrels higher compared to last year, and a decrease in consumer demand for motor gasoline throughout the last month.
The agency’s bimonthly fuels survey polled a selection of service stations throughout the state on the price of regular unleaded gasoline, diesel fuel, B-20 biodiesel fuel and E-85 ethanol. U.S. gasoline inventories increased for the week ending Dec. 17 and are reported at approximately 211.4 million barrels, an increase of 1.8 million barrels from the previous week. Gasoline supplies are well within the 5-year average for this time of year.
Since Nov. 4, U.S. crude oil prices have dropped at the NYMEX, settling below $50 per barrel and nearing $40 on Dec. 10, the lowest price since July 21. NYMEX crude oil prices set an all-time record high price on Oct. 25 at $55.67 per barrel. On Dec. 22, crude oil closed at $44.24 per barrel.
For the week ending Dec. 17, U.S. commercial crude oil stocks were up 2.1 million barrels from the previous week and up 21.4 million barrels compared to this time last year. With total U.S. crude oil inventories at 295.9 million barrels, crude oil continues to trend well within the 5-year supply band for this time of year, according to the bulletin.