Procter & Gamble soars past profit expectations

CINCINNATI, Thu Oct 25, 2012 – Procter & Gamble Co.’s profit rose more than expected, indicating that the world’s largest household products maker is making progress after coming under pressure from activist investor William Ackman, and its shares soared to the highest level in four years.

Rival Colgate-Palmolive), meanwhile, said it plans to cut about 6 percent of its workforce over the next four years as it strives to operate more nimbly as economies slow in many countries. Its quarterly profit matched expectations.

Several consumer goods makers are trimming jobs, including P&G, as concerned consumers hold off on some purchases and growth slows in major markets such as China.

P&G is on track to cut 4,200 jobs by the end of October on its way to eliminating 5,700 jobs by the end of its fiscal year. On Wednesday, Kimberly-Clark Corp. said it would eliminate 1,300 to 1,500 jobs as it leaves some low-margin businesses in Europe. Colgate’s plans, including moving away from single-country units toward regional hubs, should lead the toothpaste maker to trim about 2,300 jobs by the end of 2016.

Shares of P&G rose 4 percent to $70.83 on Thursday, their highest level since October 2008. Colgate’s shares fell 2.9 percent to $103.44.

“It wouldn’t surprise me if we’re seeing some people saying it is time to sell some Colgate, buy some Procter, given Colgate’s outperformance year to date,” said JP Morgan analyst John Faucher, who has a “neutral” rating on Colgate and an “overweight” rating on P&G.

Colgate’s shares had risen 15 percent this year through Wednesday, while P&G shares were up less than 1 percent.

Second-quarter productivity raised, wage inflation muted

WASHINGTON, Wed Sep 5, 2012 – U.S. nonfarm productivity increased at a much faster clip than previously thought in the second quarter as businesses squeezed more output from employees, government data showed on Wednesday.

Productivity increased at a 2.2 percent annual rate rather than 1.6 percent, the Labor Department said. Productivity, which measures hourly output per worker, fell at a 0.5 percent rate in the first three months of 2012.

Economists had expected second-quarter productivity would be raised to a 1.8 percent rate. The revision reflects an upward adjustment to the country’s second-quarter economic growth estimate to a 1.7 percent pace from 1.5 percent.

Businesses emerged from the 2007-09 recession lean and are showing little urgency to ramp up hiring, relying on their existing workforces to meet production.

Output increased at a 2.4 percent rate in the second quarter instead of the previously reported 2.0 percent. Output increased at a 2.7 percent pace in the first quarter.

Productivity grew rapidly as the economy recovered from its steep downturn, peaking at a 6.8 percent growth rate in the second quarter of 2009. Gains came as companies cut costs, particularly their wage bills.

Small business payrolls rise by 55,000 in December; paychecks up, too

WASHINGTON ― Small businesses created 55,000 jobs in December and increased working hours for employees, further evidence the labor market was strengthening.

In addition, workers at small businesses saw a rise in their paychecks last month, said payrolls processing company Intuit on Wednesday.

December’s gain compared to November’s upwardly revised 70,000 count, which was previously reported as an increase of 55,000.

The jobs market is showing signs of firming, with the unemployment rate dropping to a 2-1/2-year low of 8.6 percent in November. In addition, first-time applications for state unemployment benefits are hovering near 3-1/2-year lows.Households’ perceptions of the labor market are also improving, with measures of jobs “plentiful” and “hard to get” in the Conference Board’s December consumer sentiment survey yielding their best readings since January 2009.

The revision to Intuit’s small business payrolls in November suggests that the government’s nonfarm employment count for that month could be raised from 120,000 when figures for December are released on Friday.

December nonfarm payrolls are expected have increased 150,000 according to a Reuters survey, with the unemployment rate seen edging up to 8.7 percent.

The government has been revising the prior months’ nonfarm payrolls figures higher and analysts say the Bureau of Labor Statistics’ model tends to delay the count of small business employment.

The Intuit survey is based on responses from about 72,000 small businesses with fewer than 20 employees that use the Intuit Online Payroll system. It covered the period from Nov. 24 to Dec. 23.

The average work week for small business employees rose 0.4 percent to 25.4 hours, while the average monthly salary increased 0.4 percent to $2,706.