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US factory output rises for 5th straight month

By WTOP Staff

CHRISTOPHER S. RUGABER
AP Economics Writer

WASHINGTON (AP) — U.S. factory output increased for the fifth straight month in June as manufacturers cranked out more aircraft, chemicals and furniture. The modest gain underscored manufacturing’s role in helping return the economy to growth after a grim first quarter.

Factory production rose 0.1 percent last month, the Federal Reserve said Wednesday, down from a gain of 0.4 percent in the previous month. May’s data was revised slightly lower, but April’s reading was revised much higher.

Despite June’s small increase, manufacturing output rose in the second quarter at the fastest pace in more than two years, providing a critical boost to the economy after it contracted sharply in the first three months of the year. Factory output climbed 6.7 percent at an annual rate in the second quarter, the most in more than two years and up from just 1.4 percent in the first quarter.

Overall industrial production, which includes manufacturing, mining and utilities, edged up 0.2 percent in June, down from a 0.5 percent gain in May.

Mining output, which includes oil and gas drilling, surged 0.8 percent. Utility production fell 0.3 percent, mostly reflecting weather patterns. Industrial production rose at an annual rate of 5.5 percent in the second quarter, the best showing in nearly four years.

“The industrial economy is in reasonable shape but the recovery is steady rather than spectacular,” said Ian Shepherdson, chief economist at Pantheon Macroeconomics.

Most economists are optimistic that factory output will keep rising. The Federal Reserve Bank of New York said earlier this week that its regional manufacturing index reached a four-year high in July.

Americans are buying more cars and businesses are spending more on steel and other metals and computers. Auto sales reached an eight-year high in June. Auto production slipped last month, the Fed said, but that followed several months of strong gains.

Petroleum output fell, but mostly because of a temporary disruption at a large refinery, according to the Fed’s report.

The government’s jobs report earlier this month showed that factories added 16,000 positions in June, the most in four months, and the average work week for manufacturing employees remained at a post-recession high.

A survey earlier this month by the private Institute for Supply Management, meanwhile, found that manufacturing expanded in June for the 13th straight month, though at a slightly slower pace than the previous month. Growth was broad-based across nearly all the 18 sectors that the survey covers. The ISM is a trade group of purchasing managers.

The economy shrank 2.9 percent at an annual rate in the first quarter, the worst showing in five years.

But most economists expect growth returned in the April-June quarter. On average, analysts forecast the economy grew at an annual pace of 3 percent in the second quarter, according to a survey by the National Association for Business Economics. While healthy, that’s down from a 3.5 percent forecast a month earlier.

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Follow Chris Rugaber on Twitter at http://Twitter.com/ChrisRugaber

Copyright 2014 The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.

Don’t Settle for Student Loans to Pay for Online Education

By WTOP Staff
Online college programs are becoming a more popular choice for prospective students, with one study finding that more than 6 million students enrolled in at least one online course in fall 2015. The popularity of these courses can be attributed in part to their flexibility with working adults' schedules, students' ability to progress more quickly through online programs and, oftentimes, cheaper tuition. [See 10 low-cost online bachelor's programs for out-of-state students.]Online degrees can be beneficial to many college students, but some studies have shown online learners complete their programs at lower rates than students at traditional brick-and-mortar campuses. Individuals with student loans but no degree comprise two-thirds of defaulted borrowers. Though these numbers are not encouraging, just like for traditional programs, there are ways to reduce how much you'll need to borrow for an online program to ensure you won't become one of these statistics. Don't just settle on borrowing student loans to cover the whole cost of your program and living expenses. Instead, start thinking about how to cut costs and cover your balance in different ways, such as the following. -- Grants and scholarships: Even though you are taking an online course, you can still apply and receive grants and scholarships. But your first step should be to complete the Free Application for Federal Student Aid, commonly referred to as the FAFSA, which will allow you to receive a Pell Grant if your expected family contribution is low enough. The EFC criteria and award amounts are adjusted annually, but the 2017-2018 academic year awards range from $606 to $5,920, which could significantly lower the amount you borrow annually. Your next step is to apply for scholarships. You can start by checking online scholarship search engines, such as the Salt Scholarship Search, College Board's BigFuture and Peterson's. But don't forget to take advantage of local organizations and your school's financial aid office. Both may offer scholarships that you can't find with a national scholarship search. [Review these 10 sites to kick off your scholarship search.]For instance, organizations like the Elks Club, Knights of Columbus or the Rotary Club typically offer scholarships annually to local students. Just because you're going to school online doesn't mean you're ineligible. Visit your local library for scholarship listings, and ask around town. You might be surprised how many local organizations offer scholarships. While these scholarships typically aren't large, every little bit counts. Each dollar you receive in a scholarship is a dollar you don't have to borrow and pay interest on. -- Work-study: Another option for online students may be work-study awards. Not all students enrolled in online programs are eligible, but students at some schools -- including, for example, SUNY Empire State College and Liberty University -- are. Work-study awards are not given upfront like scholarships and grants. In most cases, they are an offer to earn up to the awarded amount if you secure an eligible work-study job. While there is a misconception that all work-study jobs must be on campus, students can work for off-campus, nonprofit or public employers as long as the work is in the public's interest. You may be able to work for a for-profit employer if the job is relevant to your course of study. No matter who the outside employer is, it will need to have an established agreement with your college for you to receive work-study funds. Remember, to be eligible for federal financial aid, you must be enrolled and pursuing a degree or certificate. If you're not working toward a credential, Pell Grants and work-study won't be option, but you may still be able to take advantage of private scholarships -- just be sure to read the eligibility criteria carefully. [Explore what to know about financial aid in online programs.]-- Pay as you go: One of the great benefits to enrolling online is the flexible schedule, which can allow you to complete your college coursework around your responsibilities. But prospective students often overlook using their part- or full-time job earnings as an option for paying for college. Almost 80 percent of college students in 2015 worked at least part time while attending classes, according to the National Center for Education Statistics. By budgeting and thinking strategically about your college costs, you can likely reduce your dependence on student loans by paying a portion out of pocket. Many -- but not all -- online programs are less expensive than traditional programs and often have shorter payment periods. Six, eight or 10 weeks are common course durations. Because of the frequency of payments in an online setting, you may be well-placed to pay as you go and possibly avoid borrowing altogether. Attending college online and avoiding student loans may be challenging, but if you are willing to put in the effort, you can limit the amount you need to borrow. More from U.S. News Q&A: Understanding Student Loan Discharge Eligibility Student Loan Refinancing Isn't Right for All Borrowers
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