Gasoline prices continue to decline… Labor Department says unemployment rate edged down slightly, but jobs creation slowed last month… Challenger Job Market Index: job search times now taking 4.2 months…
Texas retail gasoline prices fell for a ninth week. The weekly AAA Texas Gas Price Survey finds prices of regular, self-serve gasoline at the pump are averaging $2.17 per gallon. That’s down four cents from the previous week. The national average is $2.29 per gallon–down a nickel. Houston pumps dropped over three cents to around $2.09. Auto club spokeswoman Rose Rougeau says the price drop is aided by lower crude oil prices, increasing oil inventories, a calm hurricane season and falling demand. The cheapest gasoline is found in Corpus Christi, where it’s fallen a penny a gallon to $2.05. The priciest gas is in El Paso, where it averages $2.34 per gallon–despite an eight-cent fall.
It is a truly mixed picture on the job market coming from the government. The Labor Department says the nation’s unemployment rate has edged down slightly. At the same time, jobs creation slowed last month. The addition of 51,000 jobs to payrolls marks the smallest amount in nearly a year. It is also weaker than expected. At the same time, the previous month was revised higher. The one-tenth-of-one-percent drop in the jobless rate takes it down to 4.6 percent. A number closely watched for inflation pressure, average hourly earnings, was up four percent from a year ago. President Bush seized upon the report to say that the economy is in good shape. He noted that energy prices have been falling and that Americans have ”more money in their pocket.” Bush calls the report “more good news.” Speaking to reporters during a visit to a Fedex facility in Washington, he said it comes against a backdrop of falling energy prices. But Democrats say the job numbers are another sign the economy’s slowing. And Senator Jack Reed of Rhode Island says that’s clearly “taking its toll on job creation.”
There’s new evidence that employers are putting the brakes on hiring. The Challenger Job Market Index for the third quarter shows job search times now taking 4.2 months–the longest in 14 quarters. It’s also 11 percent longer than the 3.6 months in the second quarter, and matches the longest job search time on record, which was set in the first quarter of 2003. Job seekers age 50 and older found jobs faster than younger job seekers4.1 months versus 4.2. The index also shows that 92 percent of those winning jobs between July and September were able to get equivalent or better positions.
Goodyear doesn’t plan to let a strike at 16 plants in the U.S. and Canada side-line its business. The tire maker says it’ll turn to managers, inventory and tires from overseas. An analyst says unless the strike is lengthy, consumers should not see tire prices affected by the walkout because of the large inventory of tires in the market. Some 12,000 union employees are on strike after the union decided to stop extending a contract that expired in July. A picketer trying to keep warm near Goodyear’s Akron, Ohio headquarters Friday morning says strikers are in it for the long haul. The workers say Goodyear wanted a new contract that would have included plant closings in Tyler, Texas and Gadsden, Alabama–along with other concessions. The company says its latest offer would protect jobs and pensions.
Veteran labor organizer Steve Roberts is making some familiar arguments to Continental Airlines employees about joining his union. He’s promising greater leverage in gaining wage and benefit increases. But Roberts and his colleagues at the Transport Workers Union are also hoping to persuade about 7,800 ground workers that they need a union to protect their jobs. That is, in case rumors of a merger between Houston-based Continental and Chicago-based United Airlines come true. Continental accuses the union of stirring up false fears of an impending merger. Chief Executive Larry Kellner said this week Continental has no plans to merge with anybody. Continental officials also say if there were a merger, they would require the other carrier to protect the seniority of Continental workers. The TWU fell 300 votes short in a similar election last year. The International Association of Machinists and the Teamsters also have tried and failed to organize the Continental ground workers in the past decade.
Burlington Northern Santa Fe is defending its fuel surcharge as a necessary response to rising costs. But the Fort Worth-based freight railroad says it is examining how it calculates the extra fee on shipments. Shippers have complained that Burlington Northern and other railroads are “double-dipping”–levying fuel surcharges on top of general rate increases partly based on fuel costs. BNSF reaped $1.1 billion in fuel surcharges last year –more than 8 percent of its revenue. The railroad says it tries to avoid double-dipping and is trying to use new cost-adjustment formulas that don’t include fuel expenses.
Weaker demand for auto loans pushed consumer borrowing higher in August at the slowest pace in five months. The Federal Reserve says consumer credit rose just 2.6 percent after a July increase of 4.3 percent. The overall economy slowed in the spring as consumers tried to cope with soaring energy costs, rising interest rates and a cooling housing market.
Houston-based cell phone tower company Crown Castle International has agreed to buy smaller Florida-based rival Global Signal–a cash-and-stock deal worth about $4 billion. The combination would give the new larger company more than 24,000 wireless sites. Including assumption of $1.8 billion in debt, the deal is valued at $5.8 billion. Global Signal’s three largest shareholders, holding about 40 percent of its shares, have already agreed to vote in favor of the deal.
Michaels Stores shareholders voted to approve the sale of the arts-and-crafts retailer to two private-equity firms. When it was announced in June, Michaels valued the deal at $44 per share or about $6 billion. The company says its sale to Boston-based Bain Capital Partners and New York-based Blackstone Group is expected to close by November 4th. Michaels said holders of about 79 percent of eligible shares voted, and virtually all favored the sale. The company reported revenue last year of $3.68 billion and said it has no long-term debt.
Enterprise Products Partners has agreed to build, own and operate an 83-mile oil export pipeline in the Gulf of Mexico. The $157 million pipeline will connect from a field 120 miles off the coast of Louisiana to a platform being built by Australian mining company BHP Billiton.
Houston-based Tondu has filed an air permit application with state environmental regulators seeking permission to build a 600-megawatt power plant for Corpus Christi. The $500 million power plant, to be fueled by coal gasification combined cycle technology, would be located on the north bank of Corpus Christi’s Inner Harbor. The project could be completed in five years.
Suspicions are being raised among insider trading experts over Harrah’s Entertainment. But regulators are mum on whether an official probe has begun. The suspicions were prompted by unusual swings in the trading of options and derivative debt instruments just ahead of Harrah’s buyout bid announcement. The volume of call option trading surged in the week before the announcement that Texas Pacific Group and Apollo Management offered to purchase Harrah’s for $15 billion. Law professor James Cox of Duke University says that volume jump is a sign of possible insider trading. A call option gives the buyer the right to buy the underlying stock at a future time for a fixed price.
Three Houston nanotechnology firms are recipients of grants from the state’s Emerging Technology Fund. The Carbon Nanotechnologies Carbon Nanotube Acceleration Project was awarded $975,000 to help bring a new fuel cell technology to market. NanoComposites was awarded $1.5 million to commercialize its proprietary process for the funtionalization of carbon nanotubes. Nanospectra Biosciences received a $1.25 million grant to fund the clinical development of its AuroLase cancer therapy.
Houston-based Cooper Industries received a “Breakthrough Award” from Popular Mechanics for its Cooper Hand Tools’ $17 Crescent RapidSlide wrench. A fast-sliding mechanism replaces the slow-turning nut that’s part of the 99-year-old design of the crescent wrench. An awards ceremony was held in New York on Wednesday.