Gross Domestic Product, 1st Quarter 2020 (Advance Estimate)
Real gross domestic product (GDP) decreased at an annual rate of 4.8 percent in the first quarter of 2020 (table 1), according to the "advance" estimate released by the Bureau of Economic Analysis. In the fourth quarter of 2019, real GDP increased 2.1 percent.
The GDP estimate released today is based on source data that are incomplete or subject to further revision by the source agency (see "Source Data for the Advance Estimate" on page 2). The "second" estimate for the first quarter, based on more complete data, will be released on May 28, 2020.Welp, that's bad. Best wishes to all of us.
WASHINGTON (April 28, 2020) – The Chemical Activity Barometer (CAB), a leading economic indicator created by the American Chemistry Council (ACC), fell 5.5 percent in April on a three-month moving average (3MMA) basis following a downwardly revised 2.9 percent decline in March. On a year-over-year (Y/Y) basis, the barometer fell 7.3 percent in April.
The unadjusted data shows a 6.7 percent decline in April following an 8.9 percent decline in March and a 1.0 percent decline in February. The diffusion index slumped from 47 percent to 35 percent in April. The diffusion index marks the number of positive contributors relative to the total number of indicators monitored. The CAB reading for March was revised downward by 1.04 points and that for February was revised upward by 0.07 points.
“The latest CAB reading is consistent with a recession,” said Kevin Swift, chief economist at ACC. “The declines of April and March are the most pronounced, pervasive and persistent in the post-World War II period.”
The CAB has four main components, each consisting of a variety of indicators: 1) production; 2) equity prices; 3) product prices; and 4) inventories and other indicators.
Production-related indicators generally declined in April. Trends in construction-related resins, pigments and related performance chemistry were generally negative. Plastic resins used in packaging and for consumer and institutional applications were mixed. Performance chemistry was negative and U.S. exports were weak. Equity prices are improving. Product and input prices were negative. Inventory and other supply chain indicators were negative.
The CAB is a leading economic indicator derived from a composite index of chemical industry activity. Due to its early position in the supply chain, chemical industry activity has been found to consistently lead the U.S. economy’s business cycle, and this barometer can be used to determine turning points and likely trends in the broader economy. Month-to-month movements can be volatile, so a three-month moving average of the CAB reading is provided. This provides a more consistent and illustrative picture of national economic trends.Well, that's no good. It will be important to watch the CAB to tell us when the economy comes back on the upswing... (But we'll get the official 1st quarter estimate Wednesday morning, so that will be important confirmaton of what this looks like.)
In what they called a “live-in” at the factory, the undertaking was just one example of the endless ways that Americans in every industry have uniquely contributed to fighting coronavirus. The 43 men went home Sunday after each working 12-hour shifts all day and night for a month straight, producing tens of millions of pounds of the raw materials that will end up in face masks and surgical gowns worn on the front lines of the pandemic.
No one told them they had to do it, Braskem America CEO Mark Nikolich said. All of the workers volunteered, hunkering down at the plant to ensure no one caught the virus outside as they sought to meet the rocketing demand for their key product, polypropylene, which is needed to make various medical and hygienic items. Braskem’s plant in Neal, W.Va., is doing a second live-in now.Glad to hear these folks getting the media coverage they deserve.
After decades of consolidation, there are about 800 federally inspected slaughterhouses in the United States, processing billions of pounds of meat for food stores each year. But a relatively small number of them account for the vast majority of production. In the cattle industry, a little more than 50 plants are responsible for as much as 98 percent of slaughtering and processing in the United States, according to Cassandra Fish, a beef analyst.
Shutting down one plant, even for a few weeks, is like closing an airport hub. It backs up hog and beef production across the country, crushes prices paid to farmers and eventually leads to months of meat shortages.
“Slaughterhouses are a critical bottleneck in the system,” said Julie Niederhoff, an associate professor of supply chain management at Syracuse University. “When they go down, we are in trouble.”This virus is revealing all sorts of issues in supply chains. It will be interesting to see how supply chain management is taught in subsequent years...
The first post–COVID-19 pandemic financial results are starting to trickle in from chemical makers, and they aren’t good. Indications are that 2020 will be a year of sharp declines.
LyondellBasell Industries expects its net earnings for the first quarter will land between $110 million and $180 million when it puts out final numbers on May 1. Last quarter, before the pandemic hit, its net was $612 million.
The company says its major sites are up and running and that packaging and medical markets have been robust. However, it did idle production of plastic compounds used in auto manufacturing.
LyondellBasell has been taking money-saving measures such as reducing inventories and slowing capital spending, including the construction of a massive propylene oxide/tert-butyl alcohol plant in Texas. The company expects that 2020 capital expenditures will be down 20% from its original estimate of $2.4 billion.
Preliminary first-quarter figures from the German polyurethane chemical supplier Covestro show a 4.1% decline in sales volumes. It expects earnings before taxes to fall to $277 million, compared to $303 million in the previous quarter.
Covestro expects earnings before taxes to be between $1.1 billion and $1.6 billion for the year, , compared to more than $1.7 billion in 2019. Like Lyondell, the company is throttling back capital spending by around 20%.
In a new report, Moody’s Investor Service says it expects chemical industry earnings before taxes to decline by 10% on average during 2020. Some sectors will be affected more than others, Moody’s says. For example, coatings might be bolstered because of lower raw material costs, but US petrochemical makers will bear the brunt of lower oil prices...I don't understand how the chemical industry taking a 10% hit in earnings won't hit 1) overall employment 2) entry-level R&D employment or 3) wages overall. But we'll see how things go. Best wishes to us all.
2017
January: 101 positions
February: 68 positions
March: 97 positions
April: 61 positions
May : 52 positions
June: 68 positions
July: 95 positions
August: 77 positions
September: 64 positions
October: 116 positions
November: 61 positions
December: 53 positions
Total for 2017: 913 positions
2018
January: 76 positions
February: 65 positions
March: 87 positions
April: 78 positions
May : 73 positions
June: 91 positions
July: 101 positions
August: 60 positions
September: 84 positions
October: 97 positions
November: 103 positions
December: 76 positions
Total for 2018: 991 positions
2019
January: 140 positions
February: 99 positions
March: 122 positions
April: 82 positions
May : 111 positions
June: 89 positions
July: 91 positions
August: 114 positions
September: 84 positions
October: 111 positions
November: 42 positions
December: 96 positions
Total for 2019: 1181 positions
2020
January: 72 positions
February: 115 positions
March: 82 positions
"The US economy, now under a wide-ranging shutdown due to the novel coronavirus, is likely to shrink 4% this year. And US chemical manufacturing will decline by a similar amount, according to a forecast from the American Chemistry Council, the industry’s main trade group. In response, the ACC says, chemical firms will cut jobs and hold off on business investment.
The ACC estimates that US chemical output will fall by around 3.3% in 2020 if shutdowns are lifted before the end of June, but output could drop by 6.5% if shutdowns last through the fourth quarter. The figures do not include pharmaceuticals. In December, the association had projected output to rise slightly this year.
The decline is due to not only public health-motivated shutdowns in the US, but also to unprecedented moves by other governments to restrict the activities of business and consumers....
...While employment in the chemical industry will not suffer to the same degree as in retail, restaurant, and other service industries, ACC expects chemical job losses could total 28,000, or 5.1% of the workforce, in 2020. The cuts would reverse the industry’s 3-year run of job expansion.
And while it is not yet clear how the job cuts would be distributed among production, R&D, managerial, and administrative roles, overall business investment is expected to decline this year, the group says.Worth noting that chemist positions would be a small fraction of those 28,000 positions, but even one thousand chemists would be a major blow...
Federal Reserve Bank of Philadelphia President Patrick Harker told Yahoo Finance on Friday that the U.S. economy should brace for “very bad” data in coming quarters, predicting a sharp contraction in U.S. GDP for 2020 amid the COVID-19 lockdown.
In an interview with Yahoo Finance, Harker said his economic forecast can change depending on how quickly medical sciences can come up with ways to address the coronavirus.
“If that happens sooner, the damage is less, but right now we’re looking at year-over-year, probably around 5% hit on GDP,” he said...Well, here's hoping he's wrong (I'm not holding my breath.)
...Separate from medical supplies specific to COVID-19, a longer-term disruption of China’s pharmaceutical and medical exports could increase the cost of everyday drugs and routine medical procedures in the United States. This could happen as it becomes harder to import APIs for common drugs and components for medical devices.
According to FDA officials, in 2018, China ranked second among countries that export drugs and biologics to the United States by import line (accounting for 13.4% of U.S. imports of those products). However, FDA states it is not able to determine the volume of APIs that China is manufacturing given the complexity of the supply chain and gaps in what pharmaceutical companies are required to disclose about their inputs.
China is also a leading supplier of APIs in global supply chains for painkillers, diabetes
medicines, and antibiotics, meaning a slowdown in API exports from China could increase cost pressures faced by U.S. drug manufacturers. For example, China accounts for 52% of U.S. imports of penicillin, 90% of tetracycline, and 93% of chloramphenicol.
On February 27, FDA Commissioner Stephen Hahn announced that a manufacturer of an unspecified human drug informed FDA of a shortage the drug’s supply related to a Chinese API manufacturer affected by COVID-19. Because information disclosed to FDA regarding drug shortages is considered proprietary, FDA did not disclose the name of the drug in question, but did note that alternatives exist for patient use.
China’s role as the primary supplier of APIs to global manufacturers of generic pharmaceuticals, particularly in India, is likely to increase overall costs of generic pharmaceuticals for consumers in the United States in the short-to-medium term. The outbreak of COVID-19 in India could also affect the availability of generic pharmaceuticals in the United States. India, which supplies approximately 40% of generic pharmaceuticals used in the United States, imports nearly 70% of its APIs from China. In March 2020, India imposed export restrictions on several drugs whose
supply chains rely on China, leading to fears of potential global shortages of generic drugs that have since escalated after India announced a nationwide 21-day lockdown.
...According to an April poll of 234 employers by the National Association of Colleges and Employers, a professional association for college career services, 12 percent of the employers surveyed are revoking offers to interns and 2 percent are revoking offers to full-term recruits. Twenty-two percent of surveyed employers reported they are considering revoking offers. The companies that have cancelled internships span a myriad of industries and include NPR and Yelp, the crowd-sourced review site.
“I keep joking to my friends that I need to stop looking at LinkedIn because it's just become too sad with people who've had offers rescinded,” said Boston University senior Sarah Bickford...In the article, this useful link to a crowdsourced list of companies (including some chemical/pharma companies). Best wishes to those students, and to all of us.
In a move to fight the coronavirus pandemic, 46 Braskem America employees are living at the firm's polypropylene resin plant in Marcus Hook, Pa., for 28 days to ensure there is no interruption in production of much-needed material for medical supplies.
PP resin made by Braskem at the Philadelphia-area plant is used in fabric for N95 masks, hospital gowns and hoods, sanitary wipes and similar products. Braskem America CEO Mark Nikolich said that in the early stages of the COVID-19 crisis, the firm put social distancing and work-from-home initiatives in place while a crisis management team reviewed operations.
But Braskem also wanted to keep its manufacturing employees working at the plant.These are the sacrifices that won't get talked about very much, but I admire the folks who are doing this just the same.
The live-in idea was proposed to halt the daily movement of employees to and from the facility, potentially bringing the virus into the plant or taking it back to high-risk family members. During the 28-day period, Braskem is increasing wages while also supplying beds, kitchens, groceries, internet access and iPads. Employees are working 12-hour shifts in two groups around the clock.
Wednesday, April 15th, 9PM Eastern (8PM Central, 7PM Mountain, 6PM Pacific) we will be having a second round of Ask Dr. Safety on Google Meet.
Subject: Recovery and Contingency planning for post-COVID-19 activitiesEmail harry@midwestchemsafety.com for log-on information.
...Colorado — like most states and territories across the country — is experiencing record unemployment numbers. But the state’s unemployment system is built on aging software running on a decades-old coding language known as COBOL. Over the years, COBOL programmers have aged out of the workforce, forcing states to scramble for fluent coders in times of national crisis.
A survey by The Verge found that at least 12 states still use COBOL in some capacity in their unemployment systems. Alaska, Connecticut, California, Iowa, Kansas, and Rhode Island all run on the aging language. According to a spokesperson from the Colorado Department of Labor and Employment, the state was actually only a month or two away from “migrating into a new environment and away from COBOL,” before the COVID-19 pandemic hit....(If you're reading this blog and know an ancient programming language, it's probably FORTRAN.)
Professor Sir Harry Burns, who served as chief medical officer for Scotland from 2005 to 2014, said the failure to quickly scale up the volume of coronavirus testing was primarily down to the lack of a domestic pharmaceutical supply chain and lab capacity.
By the end of last week, there were only around 20,000 tests for coronavirus taking place every day, against a UK government target of 100,000 by the end of this month. Ministers have blamed the difficulty in securing enough of the necessary chemical reagents amid a global spike in demand triggered by the crisis.
In Germany, which is home to global pharmaceutical and chemical giants including Bayer, Boehringer Ingelheim and BASF, as many as 100,000 tests are already being carried out every day, allowing coronavirus hotspots to be identified more quickly. The country has so far posted one of the lowest trajectories for the curve of virus deaths, with a toll on Friday of 2,373.
...Asked what the key factor limiting testing capacity in the UK is, Burns pointed to “the decline in the chemicals industry, which in the 50s and 60s, the 70s and 80s even, was an important part of the British economy...
...He highlighted the closure of a major chemicals industry hub in Paisley, which saw hundreds of skilled chemicals jobs leave the area. “That whole area, which used to be a huge campus, was flattened and it’s now private housing.”I'm pretty skeptical about this, but it's an interesting idea, and it's good that people recognize that there is a tie-in between the core chemicals industry and advanced pharma/biotech. (...something tells me that, per capita, the size of the UK and the German chemical industries aren't really that different? I dunno.)
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| Credit: Tim |
Science funding mechanisms are too slow in normal times and may be much too slow during the COVID-19 pandemic. Fast Grants are an effort to correct this.
If you are a scientist at an academic institution currently working on a COVID-19 related project and in need of funding, we invite you to apply for a Fast Grant. Fast Grants are $10k to $500k and decisions are made in under 48 hours. If we approve the grant, you'll receive payment as quickly as your university can receive it.Link here. Best wishes to those interested.
The industry response to COVID-19 is inadequate. All biopharmaceutical companies should be responding with all resources to combat this health emergency. Donations from these very valuable companies do not go far enough. The biopharmaceutical industry has a large braintrust of talent that is not working on this problem as companies have deprioritized or even abandoned infectious disease research. Medicinal chemists, structural biologists, enzymologists and assay development and research biology departments at EVERY pharmaceutical company should be put to work until COVID-19 is no more.
I am asking for a brief furlough (3 months) to assist in research work on COVID-19. Being released to the post-COVID world is no solace to even the incarcerated. As a successful two-time biopharma entrepreneur, having purchased multiple companies, invented multiple new drug candidates, filed numerous INDs and clinical trial applications, I am one of the few executives experienced in ALL aspects of drug development from molecule creation and hypothesis generation, to preclinical assessments and clinical trial design/target engagement demonstration, and manufacturing/synthesis and global logistics and deployment of medicines.
PHILADELPHIA (KYW Newsradio) — A Rowan University chemistry professor and his wife killed two birds with one stone this week, by doing something good and temporarily curing boredom.
Jim Grinias is an assistant professor of chemistry at Rowan and his wife Kaitlin is a chemist at a pharmaceutical company, and they were both catching cabin fever.
"You know, after being stuck in the house for a couple of weeks, we both had the itch to get back in the lab a little bit," Grinias admitted. So they dropped off their son at grandma’s house for a couple of days and got to work making hand sanitizer, using the Centers for Disease Control and Prevention’s recipe and raw materials that were donated by the school.
"It was 200 proof ethanol, so effectively 100%, as pure as you can really buy. And then we had some hydrogen peroxide and then glycerol, which is a thick goopy liquid that is a thickening agent," Grinias explained.
As a result of the number of people that are now sequestered at home away from work and the laboratory, the Division of Organic Chemistry has decided to immediately release all of our video content that has been for members only. The nonpublic content includes 33 NOS Lecture Videos from NOS2013, NOS2015, NOS2017 and NOS2019; and 5 archived Virtual Symposia from 2018–2019.
Additionally, we want to take this opportunity to remind you of our other collections of video content such as the Eminent Organic Chemistry Videos (timeless interviews of 20 organic chemists by Jeffrey Seeman in 2008) and our small collection of historic organic chemistry lectures by Berson, Woodward, Wotiz, and Heck.There's quite a few good ones here - go take a look.
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| Credit: Calculated Risk, annotated by Chemjobber |
Total nonfarm payroll employment fell by 701,000 in March, and the unemployment rate rose to 4.4 percent, the U.S. Bureau of Labor Statistics reported today. The changes in these measures reflect the effects of the coronavirus (COVID-19) and efforts to contain it. Employment in leisure and hospitality fell by 459,000, mainly in food services and drinking places. Notable declines also occurred in health care and social assistance, professional and business services, retail trade, and construction.
This news release presents statistics from two monthly surveys. The household survey measures labor force status, including unemployment, by demographic characteristics. The establishment survey measures nonfarm employment, hours, and earnings by industry. Note that the March survey reference periods for both surveys predated many coronavirus-related business and school closures that occurred in the second half of the month.For the chemical manufacturing subsector, in February 2020, 850,400 people were employed. In March 2020, 847,400, a loss of 3000 jobs. Note that this number does not represent chemists only, rather employees of companies in the chemical manufacturing subsector.
We are making further significant adjustments to our GDP and employment estimates. We now forecast real GDP growth of -9% in Q1 and -34% in Q2 in qoq annualized terms (vs. -6% and -24% previously) and see the unemployment rate rising to 15% by midyear (vs. 9% previously). However, we have upgraded our expectations for the recovery after midyear, with a 19% qoq annualized GDP gain in Q3 (vs. 12% previously). Our estimates imply that a bit more than half of the near-term output decline is made up by year end and that real GDP falls 6.2% in 2020 on an annual-average basis (vs. 3.7% in our previous forecast).It's gonna be a big hole.
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| Credit: American Chemistry Council |
The Chemical Activity Barometer (CAB), a leading economic indicator created by the American Chemistry Council (ACC), fell 2.6 percent in March on a three-month moving average (3MMA) basis following a downwardly revised 0.1 percent gain in February. On a year-over-year (Y/Y) basis, the barometer fell 1.3 percent in March.
The unadjusted data shows an 8.0 percent decline in March following a 1.1 percent decline in February and a 1.2 percent gain in January. The unadjusted decline in March is the largest in the post-World War II period. The diffusion index slumped to 27 percent in March. The diffusion index marks the number of positive contributors relative to the total number of indicators monitored. The CAB reading for February was revised downward by 1.13 points and that for January was revised downward by 0.38 points.
"The CAB signals recessionary conditions in U.S. commerce," said Kevin Swift, chief economist at ACC. "ACC believes a recession to be occurring when the barometer declines for three consecutive months and falls 3.0 percent or more from the peak. As of March, the CAB has declined for two straight months and fallen 8.9 percent from the peak."
The CAB has four main components, each consisting of a variety of indicators: 1) production; 2) equity prices; 3) product prices; and 4) inventories and other indicators.Well, that's not good news. Best wishes to us all.
Production-related indicators generally declined in March. Trends in construction-related resins, pigments and related performance chemistry were generally negative. Plastic resins used in packaging and for consumer and institutional applications were generally negative. Performance chemistry was negative and U.S. exports were weak. Equity prices collapsed, but are improving this week. Product and input prices declined. Inventory and other supply chain indicators were negative.
