Ohio BWC Delivered Nearly $8B in Dividends to Business in 2020
This report is a summary of third-party economic research and perspectives to foster communication with business and economic development stakeholders during the COVID-19 crisis.
- Global: The European Central Bank will buy €500B bonds in a fresh stimulus.
- U.S.: While household net worth hit a new record of $123.5T in Q3, nearly four million Americans have stopped working or looking for jobs as the U.S. labor force is 2.2% smaller than February.
- Ohio: 16 projects set to create 4,183 new jobs were approved at the December Ohio Tax Credit Authority meeting. Over $170M in federal support awarded to 11 companies to support high-speed internet service in Ohio.
Global food commodity prices rose sharply in November to their highest level in nearly six years and an estimated 270M people stand on the brink of starvation according to the head of the UN’s World Food Program. Global pressure on wages from COVID-19 will not stop with the arrival of a vaccine, the head of the International Labour Organization (ILO) warned, coinciding with a report showing how the pandemic slowed or reversed a trend of rising wages across the world, hitting women workers and the low-paid hardest.
The Bank for International Settlements reports that the U.S., EU, and Japan could face a '98% economy' in the years ahead, with output returning to at best 2% below its pre-crisis trend. Output of customer-facing service industries is projected to remain between 10-20% below its pre-crisis trajectory for several years. The European Central Bank launched a fresh burst of stimulus to help the eurozone economy recover from the coronavirus pandemic, promising to buy €500B more bonds over a longer period and providing funding for banks.
The U.S. economic recovery is likely to slow further before the impact of expected approvals of COVID-19 vaccines makes itself felt in Q2 2021. Weekly initial claims for jobless benefits rose by 137,000 to a seasonally adjusted 853,000 in the week ended December 5 - the highest level since September but still well below the peak of nearly 7M in late March. The U.S. labor force is 2.2% smaller than in February, a loss of 3.7M workers. Household net worth rose 3.2% in the third quarter from the second quarter to $123.5T. Household debt rose 5.6% to $16.4T, its fastest pace in at least two years. Nearly 12M renters will owe an average of $5,850 in back rent and utilities by January. U.S. FDA Vaccines & Related Biological Products Advisory Committee, a panel of outside experts, voted in favor of endorsing emergency use authorization for the Pfizer BioNTech COVID-19 vaccine. With regards to PPE, the federal government has fallen short of its goal to shore up an emergency stockpile of respirator masks and some other personal protective equipment for health workers.
U.S. restaurants and retailers lost over 50,000 jobs in November as the employment recovery slowed during the month amid rising COVID-19 cases and new restrictions in several states. Customer transactions at major restaurant chains improved slightly in November. Across all restaurants, off-premises transactions increased 21% compared to the same period a year ago. Despite this, 58% of chain and independent full service restaurant operators expect continued furloughs and layoffs for at least the next three months. Delivery, warehousing and trucking operators added a combined 131,400 jobs last month as businesses restocked inventories and ramped up e-commerce capabilities to meet surging online demand on expectations for an unprecedented holiday-season rush. Investors are piling into wagers on industrial metals like copper and nickel, betting that coronavirus vaccines and stimulus programs will drive a boom in manufacturing activity as part of a global economic resurgence.
Ohio Employment & Economic Insights
Ohio will begin distributing the first batch of the COVID-19 vaccine developed by Pfizer next week. Ohio BWC began issuing $5B in dividends to Ohio employers on Thursday to ease COVID-19’s impact on the state’s business community and economy, bringing its total dividends this year to nearly $8B. New unemployment benefits claims last week jumped by more than 30% over the previous week to more than 36,000 claims, the highest level since last spring. Continued jobless claims also rose by nearly 6%.
Positive Company-Specific News
- Stakes Manufacturing to expand in Ohio, creating 400 jobs in Eastlake.
- Tractor Supply Company will build a new $70M, 895K distribution center in Navarre and create 375 jobs.
- Upstart, an artificial intelligence lending platform, plans to expand its facility and more than triple its Columbus footprint, creating 250 jobs.
- Lewco to Redevelop Property for Continued Growth in Ottawa County.
- Branch Financial, will add 150 jobs there with a payroll of $15M.
- ISSQUARED selected Solon for Data Center and Global Cybersecurity Operations, adding 109 jobs.
- Technology consulting firm Daugherty Business Solutions will create 100 jobs at a to-be-determined location in Columbus.
- Team Inc. will expand into Cincinnati with an aerospace inspection and testing center that will create 75 jobs.
- Digital Room expands manufacturing presence in Ohio, adding 69 jobs.
- Integrity Express Logistics Expands HQ in Ohio, adding 45 jobs. Aldi will add 30 jobs to its office operations in Dublin.
- Cincinnati Insurance Invests in Insurtech R&D in Ohio, adding 10 jobs.
- The Timken Company announced more than $75M in capital investments to increase the company's renewable energy capabilities.
- CVS Health announced $1.25M in grants to help underserved communities in Ohio increase access to food and health care.
- JPMorgan Chase is setting up a new virtual banking hub in Columbus to connect with customers in their homes that will bring in 150 workers with plans to double over the next year.
- Big Lots saw Q3 net sales climb a record 18% to $1.4B as it continues to see a surge in stay-at-home products, furniture and furnishings.
- Thor Industries posted Q1 earnings and revenue beats as the company recorded a 17.5% year-over-year increase in revenue. Notably, the company’s towable RV sector registered a total backlog of $4.4 billion – up 312% from a year-ago.
- Honda installed and donated a Multi-Agency Radio Communication System (MARCS) tower and related equipment on Honda property, thus vastly improving the coverage area for local first responders.
- Virgil Abloh and Off-White announced new philanthropic collaboration with Cleveland Clinic, and the Los Angeles-based green production shop Suay with creation of a new hand wash, hang dry mask.
Negative Company-Specific News
- Protective Life, a wholly owned U.S. subsidiary of Dai-ichi Life Holdings, announced it is relocating its core site in Greater Cincinnati to Covington, KY.
- Amcor Flexibles closing Akron plant leaving over 100 people out of work.
- Shutterfly Lifetouch will reduce its workforce by 100 at its Ontario location.
- Schneider Electric business in Valley View plans to lay off 13 workers.
- Two members of a demolition crew remained missing Thursday following the collapse of a shuttered power plant in southern Ohio.
- M. Smucker will divest its Natural Balance premium pet food business. Nexus Capital Management LP has agreed to buy the business for $50M.
- The Kroger Company is being sued for $85M by K7 Design Group over a hand sanitizer dispute.
- Honda recorded an across-the-board sales decline in November including notable declines in the Ohio-built Accord and CR-V which both fell between 25%-30%.
- Greif posted a sales decline of 6% as lower volumes in Rigid Industrial Packaging & Services and Flexible Products & Services affected the company’s bottom line.