February 2000 Edition
LABOUR
Faced with the lowest unemployment rate in decades, U.S. businesses are turning their eyes toward the large prison population for labour. Prisons Industry Enhancement (PIE) programs are expected to engage 10,000 prisoners by 2005 in everything from light manufacturing to customer service work for private enterprises. The most compelling reason employers are attracted is the prospect of cheap labour. Inmates are paid US minimum wage (U.S.$5.15 per hour), and companies hiring labour this way do not have to pay for health insurance and other benefits. Prisons take deductions for room, board and other costs from inmates' pay checks.
FAILURES
Britain's small businesses are failing at the highest rate for five years, according to a survey by Dun & Bradstreet; more than 43,000 went to the wall in 1999, an increase of 12% over 1998. Wales was worst affected with a failure rate up by 26% over 1998, but London's small businesses appeared to prosper with failures down 3.4%.
TIME
A new U.S. survey reveals that nearly half the workforce (45 per cent) has changed jobs to spend more time with their families. This is nearly as many as the 47 per cent who have changed jobs to earn more money. Last year, the International Labour Organization (ILO) reported that in 1997, Americans worked nearly 2,000 hours, up four per cent from 1980, and more hours than workers of any other industrialized country.
REPAIRS
Canadian homeowners spent an average of $1,670 repairing or renovating their homes in 1998, basically unchanged from 1997 and still well below the peak of $2,710 in 1989. In total, they spent $12.8 billion on work to their homes, almost the same amount as in 1997.
OPINION
Most taxpayers believe that it is unfair that Main Street retailers must collect sales taxes, while Internet retailers don't, says a national opinion poll released by the U.S. Conference of Mayors (USCM). On the issue of tax fairness, nearly three out of four Americans say that it is unfair. Projections over the next five years indicate a loss of up to 10 percent of sales tax revenue because of a substantial increase in Internet sales on which sales tax will not be collected.
TECHNOLOGY
Canadian manufacturing plants have more than doubled their use of advanced technologies such as computer-based networks and knowledge-based software during the past five years, according to a Statscan study. Earlier studies suggested that Canada had been lagging in its use of these more sophisticated technologies. Canadian firms were slow to adopt such technologies during the first half of the 1990s, however, this situation was likely due to recessionary pressures on the economy. During the second half of the 1990s, the rates of growth increased substantially, particularly in the computer-based network communications technologies sector.
PROTECTION
Guidelines for consumer protection in online commerce have been adopted by the Organization for Economic and Cooperative Development (OECD), an intergovernmental forum of 29 countries, including the U.S. established to promote economic growth, trade and development. According to the guidelines, online shoppers should be afforded effective protection that is not less than protection afforded offline. Although not legally binding, the guidelines provide a blueprint for governments as they formulate and implement consumer protections for electronic commerce.
SAVINGS
For the first time in seven years, fewer Canadians contributed to a registered retirement savings plan, and the amount of their contributions declined as well. About 6,122,000 taxfilers contributed to an RRSP during the 1998 tax year, down a slight 0.6% from the previous year. They contributed $26.6 billion, down 3.8% from the record $27.7 billion total in 1997. These declines occurred despite a 4.6% increase in employment income in 1997, as well as a 2.4% increase in recipients of employment income.
FREE
Despite recent massive government intervention in the stock market, Hong Kong remains the world's freest economy, according to analysis of 161 economies. The survey, by the Heritage Foundation and the Wall Street Journal, ranked Singapore and New Zealand as the World's second- and third-freest economies. Canada was ranked 11th. The U.S., Bahrain and Luxembourg tied for fourth place. Rankings of several Asian economies fell as governments intervened to pull their countries out of financial crisis.
CATALOGUES
According to the Alliance for Environmental Innovation, 17 billion catalogues were mailed in the U.S., 64 for every man, woman and child. A survey by Catalog Age found that whereas 52 per cent of Americans feel they receive too many, 40 per cent think they get the right number and 8 per cent think they don't get enough.
REGULATIONS
When the U.S. Postal Service filed to raise postal rates in 1997, the process required 100,00 pieces of paper. One hundred and eleven witnesses testified during the hearings which lasted for 37 days.
CHINA
China has announced that after joining the World Trade Organization, probably later this year, it will phase out tax concessions to foreign companies. Also, four Chinese insurance groups plan to be listed on the stock exchange to maintain competitiveness with foreign companies that will be allowed in after WTO membership.
SHIPS
Ship owners, cargo owners and insurance companies are to be given a valuable new tool in the fight against piracy with the launch of a weekly piracy report on the International Chamber of Commerce website. This report will be posted on the Commercial Crime Services pages every Tuesday. The regular reports will contain details of the location and nature of attacks on shipping in the East and South East Asian region, and will allow companies to put their ships' masters on special alert when they are passing through waters in which recent piratical attacks have been reported. The information is available at www.iccwbo.org/ccs/menu_imb_piracy.asp.
AEROSPACE
The U.S. aerospace industry posted record sales of $155 billion during 1999. The boom was driven largely by the civil aircraft sector, in particular, commercial jetliners. Commercial space generated $7.1 billion in sales in 1999, up by $962 million from 1998, despite a 41 per cent drop in exports. This was the fourth year in a row the aerospace industry has earned profits in excess of $7 billion.
ERGONOMICS
Federally regulated businesses in Canada--including airlines, banks and broadcasters, could soon be subjected to ergonomic regulations similar to those recently proposed in the U.S. Ergonomics is a relatively new science that involves fitting a job to the physical limitations of the worker. Soft-tissue injuries, many of which relate to poor ergonomic practices, are estimated to account for about 50 per cent of workplace injuries in Canada. B.C. and Saskatchewan have already enacted legislation. The B.C. regulations require employers to draft their own plan to reduce soft-tissue injuries in the workplace.
PATENTS
IBM, the world's biggest computer company, was awarded 2,756 patents by the US Patent Office last year, a record number, and 900 more than its closest rival, Japan's NEC. Some 900 patents were awarded to IBM for e-business technologies. Over the past two year, patents applied for by Xerox have increased by thirty per cent.
SPEED
A U.S. consulting group estimates that each of the top 25 U.S. Internet companies became involved in a merger or acquisition after an average of six years in business. By contrast, it took the top Fortune 500 companies an average of 75 years to enter a major merger acquisition. Smaller, speedier Internet companies merged to grow, while traditional companies typically grew first and merged later.
HEAVY-USERS
The heavy-user accounts for only one of five fast food patrons in the U.S. but about 60 per cent of all visits to fast-food restaurants. By definition, the heavy-user accounted for about $66 billion of the $110 billion that the National Restaurant Association says was spent on fast food last year. The heavy user is most often a single male who spends up to $40 a day at fast food restaurants and may visit them more than 20 times a month.
SIGNATURES
The European Union telecoms ministers have approved a law giving digital signatures on contracts agreed over the Internet the same legal status as their hand-written equivalents. This law is designed to guarantee secure transactions over the Internet and other electronic networks. It is also expected to boost electronic commerce and help Europe close the E-business gap with the U.S.
FAXES
While Canadians are sending a lot more e-mails, they still love their faxes. In a survey of 234 workers at medium-sized and large companies, respondents claimed their productivity would drop on average by nearly 40 per cent if someone took away their fax machines. The survey indicates that the use of over night express mail had dropped more than 20 per cent over the past year and only 55 per cent of respondents in all companies said they still used it regularly.
FUEL
Canada will be halfway through the 21st century before its conventional supply of natural gas is tapped out by growing domestic and export markets. And an additional 50 years worth of methane lies in Canada's coal, shale and sandstone waiting for the energy industry to figure out how to make it profitable.
DEMAND
A recent Journal of Commerce report suggests that the insatiable demand of U.S. consumers for imported goods is creating logistical headaches for ports, shipping lines, trucking companies, railroads and others in the intermodal chain. The recent peak shipping season demonstrated the large and growing gap between imports and exports which is creating imbalances of marine containers, shortages of domestic trailers and rail equipment problems. In the New York-New Jersey area, containerized imports increased last year by 12.5 per cent while exports declined by two per cent.
WHISKY
Last year, exports of Scotch whisky to the U.S. helped boost shipments to a record level. According to the Scotch Whisky Association, more Scotch was shipped than ever before in value and volume terms. Total exports were $4.8 billion with $625 million worth going to the U.S., a 14 per cent rise from the previous year.
TURKEYS!
Research Britain shows that confined turkeys are healthier and happier when they have compact discs suspended over their heads. When the birds are kept in close proximity, they sometimes fight and peck each other, causing serious injuries. However, shiny CDs hanging on polyethylene strings (which resemble worms) distract the birds by catching their eyes and aggressions. This cuts pecking incidents by up to a third.
Thank you for reading the A & A Economic News Digest. For more information visit our website www.aacb.com or contact A & A Contract Customs Brokers Ltd. at strehler@aacb.com.
Past issues of the A&A Economic News Digest can be found at http://www.aacb.com/publications/ed/index.asp
Faced with the lowest unemployment rate in decades, U.S. businesses are turning their eyes toward the large prison population for labour. Prisons Industry Enhancement (PIE) programs are expected to engage 10,000 prisoners by 2005 in everything from light manufacturing to customer service work for private enterprises. The most compelling reason employers are attracted is the prospect of cheap labour. Inmates are paid US minimum wage (U.S.$5.15 per hour), and companies hiring labour this way do not have to pay for health insurance and other benefits. Prisons take deductions for room, board and other costs from inmates' pay checks.
FAILURES
Britain's small businesses are failing at the highest rate for five years, according to a survey by Dun & Bradstreet; more than 43,000 went to the wall in 1999, an increase of 12% over 1998. Wales was worst affected with a failure rate up by 26% over 1998, but London's small businesses appeared to prosper with failures down 3.4%.
TIME
A new U.S. survey reveals that nearly half the workforce (45 per cent) has changed jobs to spend more time with their families. This is nearly as many as the 47 per cent who have changed jobs to earn more money. Last year, the International Labour Organization (ILO) reported that in 1997, Americans worked nearly 2,000 hours, up four per cent from 1980, and more hours than workers of any other industrialized country.
REPAIRS
Canadian homeowners spent an average of $1,670 repairing or renovating their homes in 1998, basically unchanged from 1997 and still well below the peak of $2,710 in 1989. In total, they spent $12.8 billion on work to their homes, almost the same amount as in 1997.
OPINION
Most taxpayers believe that it is unfair that Main Street retailers must collect sales taxes, while Internet retailers don't, says a national opinion poll released by the U.S. Conference of Mayors (USCM). On the issue of tax fairness, nearly three out of four Americans say that it is unfair. Projections over the next five years indicate a loss of up to 10 percent of sales tax revenue because of a substantial increase in Internet sales on which sales tax will not be collected.
TECHNOLOGY
Canadian manufacturing plants have more than doubled their use of advanced technologies such as computer-based networks and knowledge-based software during the past five years, according to a Statscan study. Earlier studies suggested that Canada had been lagging in its use of these more sophisticated technologies. Canadian firms were slow to adopt such technologies during the first half of the 1990s, however, this situation was likely due to recessionary pressures on the economy. During the second half of the 1990s, the rates of growth increased substantially, particularly in the computer-based network communications technologies sector.
PROTECTION
Guidelines for consumer protection in online commerce have been adopted by the Organization for Economic and Cooperative Development (OECD), an intergovernmental forum of 29 countries, including the U.S. established to promote economic growth, trade and development. According to the guidelines, online shoppers should be afforded effective protection that is not less than protection afforded offline. Although not legally binding, the guidelines provide a blueprint for governments as they formulate and implement consumer protections for electronic commerce.
SAVINGS
For the first time in seven years, fewer Canadians contributed to a registered retirement savings plan, and the amount of their contributions declined as well. About 6,122,000 taxfilers contributed to an RRSP during the 1998 tax year, down a slight 0.6% from the previous year. They contributed $26.6 billion, down 3.8% from the record $27.7 billion total in 1997. These declines occurred despite a 4.6% increase in employment income in 1997, as well as a 2.4% increase in recipients of employment income.
FREE
Despite recent massive government intervention in the stock market, Hong Kong remains the world's freest economy, according to analysis of 161 economies. The survey, by the Heritage Foundation and the Wall Street Journal, ranked Singapore and New Zealand as the World's second- and third-freest economies. Canada was ranked 11th. The U.S., Bahrain and Luxembourg tied for fourth place. Rankings of several Asian economies fell as governments intervened to pull their countries out of financial crisis.
CATALOGUES
According to the Alliance for Environmental Innovation, 17 billion catalogues were mailed in the U.S., 64 for every man, woman and child. A survey by Catalog Age found that whereas 52 per cent of Americans feel they receive too many, 40 per cent think they get the right number and 8 per cent think they don't get enough.
REGULATIONS
When the U.S. Postal Service filed to raise postal rates in 1997, the process required 100,00 pieces of paper. One hundred and eleven witnesses testified during the hearings which lasted for 37 days.
CHINA
China has announced that after joining the World Trade Organization, probably later this year, it will phase out tax concessions to foreign companies. Also, four Chinese insurance groups plan to be listed on the stock exchange to maintain competitiveness with foreign companies that will be allowed in after WTO membership.
SHIPS
Ship owners, cargo owners and insurance companies are to be given a valuable new tool in the fight against piracy with the launch of a weekly piracy report on the International Chamber of Commerce website. This report will be posted on the Commercial Crime Services pages every Tuesday. The regular reports will contain details of the location and nature of attacks on shipping in the East and South East Asian region, and will allow companies to put their ships' masters on special alert when they are passing through waters in which recent piratical attacks have been reported. The information is available at www.iccwbo.org/ccs/menu_imb_piracy.asp.
AEROSPACE
The U.S. aerospace industry posted record sales of $155 billion during 1999. The boom was driven largely by the civil aircraft sector, in particular, commercial jetliners. Commercial space generated $7.1 billion in sales in 1999, up by $962 million from 1998, despite a 41 per cent drop in exports. This was the fourth year in a row the aerospace industry has earned profits in excess of $7 billion.
ERGONOMICS
Federally regulated businesses in Canada--including airlines, banks and broadcasters, could soon be subjected to ergonomic regulations similar to those recently proposed in the U.S. Ergonomics is a relatively new science that involves fitting a job to the physical limitations of the worker. Soft-tissue injuries, many of which relate to poor ergonomic practices, are estimated to account for about 50 per cent of workplace injuries in Canada. B.C. and Saskatchewan have already enacted legislation. The B.C. regulations require employers to draft their own plan to reduce soft-tissue injuries in the workplace.
PATENTS
IBM, the world's biggest computer company, was awarded 2,756 patents by the US Patent Office last year, a record number, and 900 more than its closest rival, Japan's NEC. Some 900 patents were awarded to IBM for e-business technologies. Over the past two year, patents applied for by Xerox have increased by thirty per cent.
SPEED
A U.S. consulting group estimates that each of the top 25 U.S. Internet companies became involved in a merger or acquisition after an average of six years in business. By contrast, it took the top Fortune 500 companies an average of 75 years to enter a major merger acquisition. Smaller, speedier Internet companies merged to grow, while traditional companies typically grew first and merged later.
HEAVY-USERS
The heavy-user accounts for only one of five fast food patrons in the U.S. but about 60 per cent of all visits to fast-food restaurants. By definition, the heavy-user accounted for about $66 billion of the $110 billion that the National Restaurant Association says was spent on fast food last year. The heavy user is most often a single male who spends up to $40 a day at fast food restaurants and may visit them more than 20 times a month.
SIGNATURES
The European Union telecoms ministers have approved a law giving digital signatures on contracts agreed over the Internet the same legal status as their hand-written equivalents. This law is designed to guarantee secure transactions over the Internet and other electronic networks. It is also expected to boost electronic commerce and help Europe close the E-business gap with the U.S.
FAXES
While Canadians are sending a lot more e-mails, they still love their faxes. In a survey of 234 workers at medium-sized and large companies, respondents claimed their productivity would drop on average by nearly 40 per cent if someone took away their fax machines. The survey indicates that the use of over night express mail had dropped more than 20 per cent over the past year and only 55 per cent of respondents in all companies said they still used it regularly.
FUEL
Canada will be halfway through the 21st century before its conventional supply of natural gas is tapped out by growing domestic and export markets. And an additional 50 years worth of methane lies in Canada's coal, shale and sandstone waiting for the energy industry to figure out how to make it profitable.
DEMAND
A recent Journal of Commerce report suggests that the insatiable demand of U.S. consumers for imported goods is creating logistical headaches for ports, shipping lines, trucking companies, railroads and others in the intermodal chain. The recent peak shipping season demonstrated the large and growing gap between imports and exports which is creating imbalances of marine containers, shortages of domestic trailers and rail equipment problems. In the New York-New Jersey area, containerized imports increased last year by 12.5 per cent while exports declined by two per cent.
WHISKY
Last year, exports of Scotch whisky to the U.S. helped boost shipments to a record level. According to the Scotch Whisky Association, more Scotch was shipped than ever before in value and volume terms. Total exports were $4.8 billion with $625 million worth going to the U.S., a 14 per cent rise from the previous year.
TURKEYS!
Research Britain shows that confined turkeys are healthier and happier when they have compact discs suspended over their heads. When the birds are kept in close proximity, they sometimes fight and peck each other, causing serious injuries. However, shiny CDs hanging on polyethylene strings (which resemble worms) distract the birds by catching their eyes and aggressions. This cuts pecking incidents by up to a third.
Thank you for reading the A & A Economic News Digest. For more information visit our website www.aacb.com or contact A & A Contract Customs Brokers Ltd. at strehler@aacb.com.
Past issues of the A&A Economic News Digest can be found at http://www.aacb.com/publications/ed/index.asp
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