John’s Blog

9-6-10

Dear Friends,

I hope that everyone had a great holiday as we head into the last month of the third quarter.

Initial jobless claims declined by 6,000 the week ending August 29^th, the second straight decline after a month of increases, the Labor Department said last Thursday.

The four-week moving average, decreased to 485,500, from 488,000 the prior week for some good news on unemployment despite the fact that the overall rate clicked up to 9.6%. The private sector showed an increase of 67,000 jobs beating expectations.

The Institute of Supply Management released their purchasing managers’ index showing an August reading of 56.3 up from 55.5 in July. When the ISM reading is over 50 it indicates expanded manufacturing. The ISM new orders index was down a little at 53.1 in August from 53.5 in July. The ISM production index was up to 59.9 in August from 57.0 in July. Taken all together this is good news for the nation’s factories.

The ISM nonmanufacturing purchasing managers' index fell to 51.5 in August, from 54.3 in July signifying a slow down in the service industries.

The real surprise last week was from the retail sector which came back to life. 2/3s of the 27 retailers surveyed by Thompson Reuters reported better than forecast sales. Sales at stores open more than one year increased 3.3%. This will make retailers re-think their inventory levels if consumers are starting to come back to life.

Sales of existing homes also improved in August lifting the mood.

Trucking enjoyed its 8^th consecutive monthly gain according to the American Trucking Association. The ATA said that July tonnage was up 7.4% year over year and had increased 1.5% from June. The ATA index increased to 110.2 getting it back to the April level of activity it had slipped in May and June.

Cass Information confirmed the increased freight trend by reporting that shipments in August rose 16.5% from the same month last year.

If the consumer keeps buying and manufacturing continues its upward trend, one should expect that a tight trucking market will continue for the rest of the year while freight volumes improve.

I would like to thank Mike Millard for a tour of the MWV Calmar plant and distribution center in Grandview MO last week. Mike takes a lot of pride in his DC and it shows as it has the automation and performance attitude that I really admire. This is a fine example of American manufacturing at its best.

At Wagner we are enjoying the usual bump in seasonal volume as we produce thousands of complex floor ready pallet displays though Wagner’s packaging operations. E-Commerce fulfillment is active as is our transportation group in helping in the current capacity shortage.

Should you have any projects on the horizon please give us a call. I know that many are planning for 2011. I welcome an invitation to the table should you be interested in an outsourced solution for distribution warehousing, fulfillment, contract packaging or transportation. Wagner has the team and technology to help where needed.

Have a great week!

John Wagner Jr