News

Solid growth for NAICS 444

Stronger than average monthly performance for building material category.

BY HBSDealer Staff

Sales at building material and garden equipment and supplies dealers (NAICS 444) increased 4.4% on an adjusted basis in April, compared to the same month in 2017, according to the advance monthly sales report released Tuesday by the Commerce Department.

The NAICS 444 retailers — a diverse group that includes hardware stores and building supply dealers — posted an unadjusted $35.7 billion in sales for April. Compared to the previous month, again on an adjusted basis, sales increased 0.4%.

Other than gas stations (up 11.7% on the year), the fastest-growing segment of retail was non-store retailers, up 9.6%.

Overall retail sales in April — excluding automobiles, gasoline stations and restaurants — increased 0.4% seasonally adjusted over March and 2.8% year-over-year as consumers continued to spend.

“Retail sales growth remains solid and on track as households benefit from tax cuts even though they have faced unseasonable weather and bumpy financial markets,” National Retail Federation chief economist Jack Kleinhenz said. “The tax cuts and higher savings levels should help consumers afford the recent surge in gasoline prices. And a solid job market, recent wage gains and elevated confidence translate into ongoing spending support.”

The report also showed:

  • General merchandise stores were up 2.5% year-over-year and up 0.3% from March seasonally adjusted.
  • Sporting goods stores were down 1.1% year-over-year and down 0.1% from March seasonally adjusted.
  • Electronics and appliance stores were up 1.7% compared to last year, and down 0.1% compared to March.

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Banner year for Eagle Materials

Full-year sales rise 14% to $1.4 billion for the cement and wallboard supplier.

BY HBSDealer Staff

Eagle Materials Inc., the building products manufacturer and distributor, reported record fourth quarter 2018 revenue of $284.7 million – a 2% rise from $278.7 in the fourth quarter a year ago.

For the full fiscal year, the Dallas, Texas-based company reported a record revenue of $1.4 billion. This marks a 14% increase from 2017 revenue of $1.2 billion.

Net earnings for the fourth quarter grew 2.2% to $37 million from net earnings of $36.2 million in the fourth quarter 2017. Full-year earnings soared more than 29% to $256.6 million from 2017 net earnings of $198.2 million.

Revenue in the Eagle’s heavy materials sector, which includes cement, concrete and agregates increased 12% to $807.4 million in 2018. Sales in the light materials sector, which includes gypsum wallboard and paperboard, increased 4% to $603.2 million for the year.

The company also operates an oil and gas proppants segment, reporting revenue of $85.5 million – an increase of 147%, reflecting a 170% increase in frac sand sales volume

Based in Dallas, Texas, Eagle Materials manufactures and distributes cement, aggregates, concrete, gypsum wallboard, recycled paperboard and frac sand from more than 75 facilities in the United States.

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Regulatory Wrap-Up
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Regulatory Wrap-Up: Paid leave, wages lead the roundup

BY HBSDealer Staff

Wages

Connecticut: A last-minute effort to pass compromise legislation increasing the minimum wage to $12.10, instead of the proposed $15/hr, failed to pass either chamber before the legislature adjourned for the year.

Vermont: The house passed a bill to increase the state’s minimum wage to $15/hr by 2024. In February, the senate passed a similar bill with a shorter transition, increasing to $15/hr by 2022. The house bill will need to be approved by the senate in its current form or it could be amended into a compromise bill in a conference committee. The governor has stated he is likely to veto the increase.

 

Paid Leave

New Jersey: Following the passage of the statewide sick leave law, a senate committee advanced a bill expanding the state’s existing paid family leave law. The bill would increase the amount of time provided to care for a newborn from six to twelve weeks and increase the pay workers receive during that time. The bill would also lower the compliance threshold to cover businesses that employ 30 workers, down from the current standard of 50.

Vermont: The senate passed a paid leave bill similar to a previously-passed house bill. The senate bill allows twelve weeks for parental leave and up to six weeks for care for a sick relative. The program is funded by employees through a 0.136 percent payroll tax on the first $150,000 earned. The bill will need to be conferenced with the house-passed legislation in order to advance to the governor. He has threatened to veto the bill citing his previous pledge not to raise taxes. It does not appear that the legislature would have enough votes to override a potential veto.

 

Scheduling

Chicago: Labor interests and several city aldermen renewed their push for the proposed citywide “fair work week” ordinance that has, to date, failed to move forward. The group released a survey highlighting employer scheduling practices that they deem detrimental. Such practices include “on call” scheduling and a lack of advanced notice of schedules.

 

Joint Employer

NLRB: According to the recently-released Trump Administration’s spring agenda, the NLRB is considering clarifying its position on the joint employer issue through the rulemaking process. Going back to 2015 when the Obama-era Board overturned the long-standing joint employer precedent, employers have called for greater clarity and hoped for either the Board or Congress to establish guardrails, clearly defining what constitutes a joint employer relationship. The rulemaking process, which could stretch over a year, would provide that opportunity. The Board has not established a timeline to act but listed this as a “long term action.”

 

Labor Policy

U.S. Senate: Senator Bernie Sanders has introduced legislation that, if passed, would significantly strengthen labor’s leverage in the workplace. Among other actions, the bill would codify a recent California court decision regarding a new three-part test relating to the definition of an independent contractor. The bill would also preempt state right to work laws and implement a “card check” union voting system. While there is no chance this bill advances in this Congress, it will serve to rally labor interests as the midterm elections approach.

Labor Department: Also included in the recently-released Trump Administration’s spring agenda was an indication that there will be a delay in the issuance of the Labor Department’s new overtime regulation to sometime in early 2019. While there is no cause for concern at this juncture, future delays may present considerable challenges. The Labor Department also intends to issue a rule proposal which will update the regular rate requirements under the FLSA sometime in the fall of 2018. Finally, the agency has announced that it intends to issue a proposed rule on tip pooling by August 2018. It intends to use this new proposed rule to withdraw the controversial Obama-era tip pooling rule and to clarify a recently enacted provision in Congress’s budget bill.

Labor Department: A top Trump ally, former chief counsel to the Trump transition team, was named to the influential post of principal deputy assistant secretary for policy. He now leads the office charged with counseling Labor Secretary Acosta on policy developments and overseeing the crafting of regulations across the department.

New Jersey: The state legislature is considering a bill that would nullify aspects of non-compete agreements for certain types of workers. The bill is in the early stages of the legislative process in the general assembly. There has been a growing interest by federal and state lawmakers to regulate non-compete or no-poach agreements.

New York City: Mayor de Blasio signed the New York City Sexual Harassment Act, which is a slate of bills including a mandate that employers with fifteen or more employees provide city-approved sexual harassment prevention training.

 

Taxes

Georgia: The governor signed into law a bill that expands sales tax collection obligations to sellers with more than $250,000 in sales or more than 200 sales into the state.

 

Soda Taxes

Pennsylvania: A house committee advanced legislation that would preempt local governments from implementing any taxes on sugar-sweetened beverages. The full house may take action in the coming weeks. In related news, the litigation against the Philadelphia law which went into effect Jan. 2017 is slated to be heard in the state supreme court next week.

 

Menu Labeling

California: This week, a superior court judge finalized a ruling in a long-running case against coffee sellers who do not display cancer-warning signs in compliance with the state’s Proposition 65 law. The judge ruled that coffee sellers failed to show that the risks from consuming potentially carcinogenic chemicals in coffee are offset by the health benefits associated with drinking the caffeinated beverage. This opens the door for potential settlements that could include a reformulation of the product to remove the chemicals in question, fines and/or agreements by sellers to post appropriate in-store signage.

 

Key Takeaways

  • A handful of states held primary elections last week. Overall, “establishment” Republicans prevailed in the party’s primary elections. In Indiana, an “outsider” won the nomination in their U.S. Senate contest; however, he served in the Indiana legislature which hardly meets the “outsider” definition by today’s standard. The national party has to be excited that, at least in these early primary states, they’ll be fielding more centrist (traditionally considered electable) candidates on the general election ballot.
  • At a time when Trump appointees are finally being confirmed and rolling up their sleeves at federal agencies, many are moving into overdrive as it relates to labor regulations. Expect the next year to be active at the federal agency level, particularly at the Labor Department and the NLRB, as the administration attempts to promulgate new rules and regulations before the end of the President’s first term.
  • As the conversation in DC around no-poach and non-compete agreements continues, more states could pick up the issue. It’s unlikely that New Jersey will be the last state to dive into this space and employers should stay engaged in the state level conversations on this issue.

 

Legislature Status for Week of 5/14/18

  • The United States Senate is in session this week
  • The United States House is in session this week
  • Thirteen state legislatures are meeting actively this week: California, Delaware, Illinois, Indiana, Louisiana, Massachusetts, Michigan, Minnesota, Missouri, New Jersey, Ohio, New York and Rhode Island.

 

Podcast

Check out our Working Lunch podcast each week that includes further analysis into these legislative issues, policy, politics and much more. You can find Working Lunch on the Nation’s Restaurant News website, or by clicking here, and when you download the podcast and subscribe on iTunes here.

 

The Regulatory Wrap-Up is presented by Align Public Strategies. Click here to learn how Align can provide your brand with the counsel and insight you need to navigate the policy and political issues impacting retail.

 

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