Morning business headlines: 10-3-13
Thursday, October 03, 2013 11:20 AM
U.S. companies warn of delays, furloughs from shutdown
The U.S. government shutdown is beginning to hit the factory floor, with major manufacturers like Boeing Co. and United Technologies Corp. warning of delays and employee furloughs in the thousands if the budget impasse persists, Reuters reports. Companies that rely on federal workers to inspect and approve their products or on government money to fund their operations said they are preparing to slow or stop work if the first government shutdown in 17 years continues into next week. In the article, United Technologies said nearly 2,000 workers in its Sikorsky Aircraft division, which makes the Black Hawk military helicopter, would be placed on furlough Monday if the shutdown continues. That number would climb to more than 5,000 and include employees at its Pratt & Whitney engine unit and Aerospace Systems unit if the shutdown continues into November, the company said in a statement sent to Reuters.
Partial victory for BP in dispute over settlement
According to The New York Times, a federal appeals court gave BP PLC a partial victory on Wednesday by ordering a lower court judge to reconsider his interpretation of a settlement with claimants who filed billions of dollars of claims against the oil company after the 2010 Deepwater Horizon oil spill disaster. In a divided opinion, the majority of the judges found that the formula that measured a potential loss needed to be clarified. The third judge argued in a dissent that BP was trying to change the rules it had already agreed to. According to the article, BP has repeatedly complained about the claims process, arguing that the program's administrator, Patrick Juneau, was approving fabricated payments for business economic losses based on an unsound interpretation of an agreement the company reached with victims last year.
U.S. jobless claims point to labor market healing
The number of Americans filing new claims for jobless benefits edged higher last week but remained at pre-recession levels, a signal of growing strength in the labor market, Reuters reports. Initial claims for state unemployment benefits rose 1,000 to a seasonally adjusted 308,000, the Labor Department said today. The data could provide some of the strongest guidance this week on the health of the U.S. economy, the article said, as a partial government shutdown delays the release of economic data, including the monthly employment report, which was scheduled to be released on Friday. New jobless claims have been falling for much of this year, and for weeks there have been fewer of them than even before the 2007-09 recession began, a signal that the long cycle of elevated layoff levels had ended. However, employers have been more reticent about adding new workers to payrolls, and many economists doubt whether the claims data still provides a clear signal on the pace of hiring.
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