US economic growth for last quarter is revised up slightly to a healthy 3.4% annual rate

 The U.S. economy grew at a solid 3.4% annual pace from October through December, the government said Thursday in an upgrade from its previous estimate.

The government had previously estimated that the economy grew at a 3.2% annual rate last quarter.

The Commerce Department’s revised measure of the nation’s gross domestic product — the total output of goods and services — confirmed that the economy decelerated from its sizzling 4.9% rate of expansion in the July-September quarter.

But last quarter’s growth was still a solid performance, coming in the face of higher interest rates and powered by growing consumer spending, exports and business investment in buildings and software. It marked the sixth straight quarter in which the economy has grown at an annual rate above 2%.

For all of 2023, the U.S. economy — the world’s biggest — grew 2.5%, up from 1.9% in 2022. In the current January-March quarter, the economy is believed to be growing at a slower but still decent 2.1% annual rate, according to a forecasting model issued by the Federal Reserve Bank of Atlanta.

The economy’s resilience over the past two years has repeatedly defied predictions that the ever-higher borrowing rates the Federal Reserve engineered to fight inflation would lead to waves of layoffs and probably a recession. Beginning in March 2022, the Fed jacked up its benchmark rate 11 times, to a 23-year high, making borrowing much more expensive for businesses and households.

Yet the economy has kept growing, and employers have kept hiring — at a robust average of 251,000 added jobs a month last year and 265,000 a month from December through February.

At the same time, inflation has steadily cooled: After peaking at 9.1% in June 2022, it has dropped to 3.2%, though it remains above the Fed’s 2% target. The combination of sturdy growth and easing inflation has raised hopes that the Fed can manage to achieve a “soft landing” by fully conquering inflation without triggering a recession.

Thursday’s report was the Commerce Department’s third and final estimate of fourth-quarter GDP growth. It will release its first estimate of January-March growth on April 25.

Home Depot will buy SRS Distribution, a materials provider for professionals, in a deal valued at approximately $18.25 billion.

It is Home Depot’s largest acquisition in its history and with it, it steps more aggressively into the fast growing professional builder and contactor business.

SRS provides materials for professionals like roofers, landscapers and pool contractors.

Home Depot is making a big bet on a housing market that is suffering a severe lack of new homes, which has driven prices sky high. The median sales price for new homes in the U.S. has climbed 29.4% over the past five years. In the fourth quarter, the median sales prices totaled $417,700, according to data from the Federal Reserve Bank of St. Louis.

The U.S. housing market is coming off a deep, 2-year sales slump triggered by one-two punch of so few homes and sharp rise in mortgage rates. The overall decline in rates since their peak last fall has opened a tiny window for some, though a home remains out of reach for millions of Americans.

Sales of previously occupied U.S. homes rose in February from the previous month to the strongest pace in a year with homebuyers encouraged by that modest pullback in mortgage rates.

With mortgage rates still high, millions of people are spending money on upkeep for the homes that they own, another financial driver for the Home Depot, SRS deal.

Home Depot said that when taking the deal into account, it now believes its total addressable market is approximately $1 trillion, an increase of approximately $50 billion.

“SRS has built a robust and successful platform that will accelerate our growth with the residential professional customer while presenting future opportunities with the specialty trade pro,” Home Depot CEO Ted Decker said in a statement.

SRS’s has a sales team of more than 2,500 and more than 760 branches across 47 states. It also has 4,000-plus truck fleet and jobsite delivery capabilities.

“We are looking forward to combining our differentiated assets and capabilities, including our extensive branch network, experienced sales team, robust trade credit offering, and order management system, geared at serving the complex project purchase occasion, with The Home Depot’s competitive advantages,” SRS CEO Dan Tinker said. “We believe this will enable us to better serve pros and continue growing in our large and highly fragmented market.”

Tinker and his senior management team will continue to lead SRS, which is based in McKinney, Texas.

The deal is expected to close by the end of fiscal 2024.

— For the first time in 27 years, the U.S. government is changing how it categorizes people by race and ethnicity, an effort that federal officials believe will more accurately count residents who identify as Hispanic and of Middle Eastern and North African heritage.

The revisions to the minimum categories on race and ethnicity, announced Thursday by the Office of Management and Budget, are the latest effort to label and define the people of the United States. This evolving process often reflects changes in social attitudes and immigration, as well as a wish for people in an increasingly diverse society to see themselves in the numbers produced by the federal government.

“You can’t underestimate the emotional impact this has on people,” said Meeta Anand, senior director for Census & Data Equity at The Leadership Conference on Civil and Human Rights. “It’s how we conceive ourselves as a society. ... You are seeing a desire for people to want to self-identify and be reflected in data so they can tell their own stories.”

Under the revisions, questions about race and ethnicity that previously were asked separately on forms will be combined into a single question. That will give respondents the option to pick multiple categories at the same time, such as “Black,” “American Indian” and “Hispanic.” Research has shown that large numbers of Hispanic people aren’t sure how to answer the race question when that question is asked separately because they understand race and ethnicity to be similar and they often pick “some other race” or do not answer the question.

A Middle Eastern and North African category will be added to the choices available for questions about race and ethnicity. People descended from places such as Lebanon, Iran, Egypt and Syria had been encouraged to identify as white, but now will have the option of identifying themselves in the new group. Results from the 2020 census, which asked respondents to elaborate on their backgrounds, suggest that 3.5 million residents identify as Middle Eastern and North African.

“It feels good to be seen,” said Florida state Rep. Anna Eskamani, a Democrat from Orlando whose parents are from Iran. “Growing up, my family would check the ‘white’ box because we didn’t know what other box reflected our family. Having representation like that, it feels meaningful.”

The changes also strike from federal forms the words “Negro” and “Far East,” now widely regarded as pejorative, as well as the terms “majority” and “minority,” because they fail to reflect the nation’s complex racial and ethnic diversity, some officials say. The revisions also encourage the collection of detailed race and ethnicity data beyond the minimum standards, such as “Haitian” or “Jamaican” for someone who checks “Black.”

The changes to the standards were hammered out over two years by a group of federal statisticians and bureaucrats who prefer to stay above the political fray. But the revisions have long-term implications for legislative redistricting, civil rights laws, health statistics, and possibly even politics as the number of people categorized as white is reduced.

Donald Trump, the presumptive GOP nominee for president, recently alluded to arguments made by people who allege Democrats are promoting illegal immigration to weaken the power of white people. As president, Trump unsuccessfully tried to disqualify people who were in the United States illegally from being included in the 2020 census.

Momentum for changing the race and ethnicity categories grew during the Obama administration in the mid-2010s, but was halted after Trump became president in 2017. It was revived after Democratic President Joe Biden took office in 2021.

The changes will be reflected in data collection, forms, surveys and the once-a-decade census questionnaires put out by the federal government, as well as in state governments and the private sector because businesses, universities and other groups usually follow Washington’s lead. Federal agencies have 18 months to submit a plan on how they will put the changes in place.

The first federal standards on race and ethnicity were produced in 1977 to provide consistent data across agencies and come up with figures that could help enforce civil rights laws. They were last updated in 1997 when five minimum race categories were delineated — American Indian or Alaska Native, Asian, Black or African American, Native Hawaiian or other Pacific Islander and white; respondents could pick more than one race. The minimum ethnic categories were grouped separately as not Hispanic or Hispanic or Latino.

The interagency group that worked on the latest revisions noted that categories are sociopolitical constructs and race and ethnicity are not defined biologically or genetically.

Racial and ethnic categories used by the U.S. government reflect their times.

In 1820, the category “Free Colored People” was added to the decennial census to reflect the increase in free Black people. In 1850, the term “Mulatto” was added to the census to capture people of mixed heritage. American Indians were not explicitly counted in the census until 1860. Following years of immigration from China, “Chinese” was included in the 1870 census. There was not a formal question about Hispanic origin until the 1980 census.

Not everyone is on board with the latest revisions.

Some Afro Latinos feel that combining the race and ethnicity question will reduce their numbers and representation in the data, though previous research by the U.S. Census Bureau did not find significant differences among Afro Latino responses when the questions were asked separately or together.

Mozelle Ortiz, for instance, is of mixed Afro Puerto Rican descent. She feels the changes could eliminate that identity, even though people can choose more than one answer once the race and ethnicity questions are combined.

“My entire lineage, that of my Black Puerto Rican grandmother’s and all other non-white Spanish speaking peoples, will be erased,” Ortiz wrote the interagency group.

William Chalmers, in a letter to the group, worried that combining race and ethnicity questions would conflate the two definitions.

“Just as gender and sexual orientation are treated as different markers so should ‘race’ and ‘culture,’” Chalmers said.

Ford will drastically cut the number of hourly workers at its factory that builds the Ford F-150 Lightning as sales of electric vehicles slow, according to a media report.

Ford began the year by cutting production of the F-150 Lightning electric pickup after weaker-than-expected electric vehicle sales growth.

While EV sales are growing in the U.S., the pace is falling well short of the industry’s ambitious timetable and many consumers are turning to hybrid vehicles instead.

Ford sold just over 24,000 Lightnings last year, up 55% from 2022. But dealers are reporting slower sales and rising inventories on the electric truck, which starts at just under $50,000.

On Wednesday, the Detroit Free Press and Louisville Courier reported that Ford will begin trimming the hourly workforce next week at the Rouge Electric Vehicle Center in Dearborn, Michigan, according to Ford spokeswoman Jessica Enoch.

Of the 2,100 workers who make up three work crews at the Dearborn facility, a third will remain, Enoch told the Detroit Free Press. Ford will transfer 700 workers to the Michigan Assembly Plant in Wayne to build the Bronco and Ranger. The remaining 700 workers will either take a retirement package offered during last year’s contract talks with the United Auto Workers, or will take a reassignment in southeast Michigan. Ford is adding a third crew at Michigan Assembly, the paper reported.

Shares of Ford Motor Co. were essentially flat before the opening bell

Post a Comment

Previous Post Next Post