1

WHAT RECOVERY YOU SAY???

GOOD QUESTION WE SAY!

2

WHAT RECOVERY???

If you took today’s economic fundamentals as a snapshot in

time we would still be in the worst recession since the great

depression!

3

EmploymentEmployment

Job LossesJob Losses

UnemploymentUnemployment

Manufacturing Job NumbersManufacturing Job Numbers

4

Job Losses in Recent U.S. RecessionsJob Losses in Recent U.S. Recessions

-9000

-7000

-5000

-3000

-1000

1000

3000

5000

1 3 5 7 9 11 13 15 17 19 21 23 25 27 29 31 33 35 37 39C

han

ge

in U

.S. j

ob

s (i

n T

ho

usa

nd

s)

Months After Peak Job Month

Current Recession Current Recession With 9/10 Prelim. Benchmark Adjust.

2001 Recession 1990 Recession

1981 Recession 1974 Recession

2001 Recession2001 Recession

Current RecessionCurrent Recession

1990 Recession1990 Recession

1981 Recession1981 Recession

1974 Recession1974 Recession

Jul ‘74Jul ‘74

Jul ‘81Jul ‘81

Jun ‘90Jun ‘90

Feb ‘01Feb ‘01

Dec ‘07Dec ‘07

Current w / Prelim Benchmark Adj.Current w / Prelim Benchmark Adj.

5

Official vs. Real UnemploymentOfficial vs. Real Unemployment(accounts for part-time workers who used to work full time(accounts for part-time workers who used to work full timeand people who have stopped looking for work)and people who have stopped looking for work)

U.S

. B

urea

u of

Lab

or S

tatis

tics,

Lab

or F

orce

Sta

tistic

s, S

easo

nally

Adj

uste

d (

Tab

le A

-12.

Alte

rnat

ive

mea

sure

s of

labo

r un

deru

tiliz

atio

n).

0%

2%

4%

6%

8%

10%

12%

14%

16%

18%

Un

emp

loym

ent

Lev

el

Jul-07

Aug-07

Sep-07

Oct-07

Nov-07

Dec-07

Jan-08

Feb-08

Mar-08

Apr-08

May-08

Jun-08

Jul-08

Aug-08

Sep-08

Oct-08

Nov-08

Dec-08

Jan-09

Feb-09

Mar-09

Apr-09

May-09

Jun-09

Jul-09

Aug-09

Sep-09

Oct-09

Nov-09

Dec-09

Jan-10

Feb-10

Mar-10

Apr-10

May-10

Jun-10

Jul-10

Aug-10

Sep-10

Official Unemployment (U-3) Real Unemployment (U-6)

Sept. 2010

Sept. 2010

17.1%17.1%

6

U-6 Unemployment U-6 Unemployment RateRate

U-6 Unemployment Rate (as reported by U.S. Bureau of Labor Statistics)

September 2009

January 2010

August 2010

September 2010

(000s)    

Unemployed 15,159

14,837

14,860

14,767

Involuntary Part-Time Workers 9,158

8,316

8,860 9,472

Marginally Attached Workers 2,219

2,536

2,370 2,548

Real / U-6 Unemployed 26,536

25,689

26,090

26,787

Real Unemployment Rate 17.0% 16.5% 16.7% 17.1%

7

Unemployment ClassificationsUnemployment Classifications

• Category U-3: This is the official unemployment number, the formula for which has been largely unchanged since 1940, and represents the total unemployed, as a percent of the civilian labor force. For this category, if you did any work at all during the reference week, you are considered employed. If you did no work, but searched for a job sometime in the 4 weeks prior to the survey, you are “unemployed.” If you do not meet either test, you are “not in the labor force.”

8

Unemployment ClassificationsUnemployment Classifications

• Category U-6: This is the most comprehensive of the alternative measures, and BLS expects it to be used to demonstrate the degree to which existing and potential labor resources are not being utilized. It captures workers who are visibly underemployed and all persons who are “marginally attached” to the labor force. Specifically, the formula adds the following workers:– Total unemployed workers (U-3)

– All “marginally attached” workers• Persons not in the labor force who want a job, and explicitly available for work, and have looked for work

sometime in the past year (or since the end of their last job if they held one within the past year), but are no longer looking for work for some reason.

• This includes “discouraged workers”– A sub-class of marginally attached workers, who are not currently looking because they believe there are no jobs

available or there are none for which they would qualify.– Currently the definition or discouraged worker includes people who have stopped looking for work, but have made

some attempt to find a job within the past year. Once these people have been "discouraged" for more than a year, they are no longer included. Prior to 1993, this was not the case: people who had not looked within a year were still included. Some analysts believe this has cut the number of discouraged workers in half.

– Total workers employed part time for economic reasons• Persons who want and are available for full-time work but have had to settle for a part-time schedule .

9

Three Charts That Will Infuriate Taxpayers

10

11

12

13

14

U.S. Manufacturing JobsU.S. Manufacturing Jobs(in thousands)(in thousands)

U.S. Manufacturing JobsU.S. Manufacturing Jobs(in thousands)(in thousands)

10,000

12,500

15,000

17,500

20,000

Jan-98

Jan-99

Jan-00

Jan-01

Jan-02

Jan-03

Jan-04

Jan-05

Jan-06

Jan-07

Jan-08

Jan-09

Jan-10

Over 6 million manufacturing jobs have been lost since Over 6 million manufacturing jobs have been lost since manufacturing last peaked in 1998manufacturing last peaked in 1998

June 1998

June 1998

17.7 Million

17.7 Million

JobsJobs

Mar

ch 2

010

Mar

ch 2

010

11.5

Mill

ion

11.5

Mill

ion

Jobs

Jobs

14Source: U.S. Bureau of Labor Statistics, Not Seasonally Adjusted

15

0

5,000

10,000

15,000

20,000

25,000

1939

1945

1951

1957

1963

1969

1975

1981

1987

1993

1999

2005U.S

. Man

ufa

ctu

rin

g J

ob

s (i

n T

ho

usa

nd

s)

Marc

h 2010

March 2010

11.5 Milli

on

11.5 Milli

on

JobsJobs

The last time we had this few manufacturing jobs was

APRIL 1941

16

Wal-Mart’ing of AmericaWal-Mart’ing of AmericaEmployment in Manufacturing vs. Retail SectorsEmployment in Manufacturing vs. Retail Sectors

4

8

12

16

20

Em

plo

yees

(Millions)

1950

1952

1954

1956

1958

1960

1962

1964

1966

1968

1970

1972

1974

1976

1978

1980

1982

1984

1986

1988

1990

1992

1994

1996

1998

2000

2002

2004

2006

2008

2010

Manufacturing Retail Less ManufacturingJobs now than anytime since 1950!

Average Manufacturing Job: $18.46 /hr Average Retail Job: $12.99 /hrAverage Manufacturing Job: $18.46 /hr Average Retail Job: $12.99 /hr Source: U.S. Bureau of Labor Statistics, Current Employment Statistics Survey, Not Seasonally Adjusted; National Industry-Specific Occupational Employment and Wage Estimates

17

Red Taping of AmericaRed Taping of AmericaEmployment in Manufacturing vs. Government SectorsEmployment in Manufacturing vs. Government Sectors

4

8

12

16

20

24

Em

plo

yees

(Millions)

1950

1952

1954

1956

1958

1960

1962

1964

1966

1968

1970

1972

1974

1976

1978

1980

1982

1984

1986

1988

1990

1992

1994

1996

1998

2000

2002

2004

2006

2008

2010

Manufacturing Government

Source: U.S. Bureau of Labor Statistics, Current Employment Statistics Survey, Not Seasonally Adjusted; National Industry-Specific Occupational Employment and Wage Estimates

Less ManufacturingJobs now than anytime since 1950!

Average Manufacturing Job: $18.46 /hr Average Gov’t Job: $23.00 /hrAverage Manufacturing Job: $18.46 /hr Average Gov’t Job: $23.00 /hr

18

0

5

10

15

20

25

30

Mill

ions

of U

.S. J

obs

ARRA "Create or Save" Job Deficit

3.5 millionby March 2011

7-9 million underemployed workers

26-29 Million

3.5 million jobs for new workers over last 27 months

Over 8.2 million jobs just to return to Dec. 2007 levels fromMar. 2010

6-8 million jobs needed for population growth in next 4-5 years

Existing Stimulus is Not Existing Stimulus is Not EnoughEnough

19

Creating Jobs MUST BECreating Jobs MUST BETop PriorityTop Priority

Over 25+ Million Jobs NeededOver 25+ Million Jobs Needed• More than 8.4 million lost in recession• Another 3.5 million needed to be created for the new

entrants into the workforce over the last 27 months• More than 7-9 million underemployed/working part

time• More than 6-8 million jobs in the next 4 to 5 years to

keep up with population growth

20

Creating Jobs MUST BECreating Jobs MUST BETop PriorityTop Priority• This totals to 26-29 million jobs that we

need to create over the next 4-5 years

• On a separate note:

More than 6 million manufacturing jobs lost since 1998 due to failed trade policies

21

How Did We Get Here?How Did We Get Here?

22

How Did We Get Here?How Did We Get Here? 1970---Today: A massive Failure of Trade Policies1970---Today: A massive Failure of Trade Policies

Mercantilism wins out versus FREE Trade Mercantilism wins out versus FREE Trade

Bought into a Failed Economic Model: Bought into a Failed Economic Model:

A Service based Economy could replace a Manufacturing based A Service based Economy could replace a Manufacturing based Economy Economy as the Wealth Creation Engine of Our Economy and…….as the Wealth Creation Engine of Our Economy and…….

… …..the Driver for a Healthy and Growing Middle Class!..the Driver for a Healthy and Growing Middle Class!

Result: Result: 1—Manufacturing shrinks from over 30% to 9.9%1—Manufacturing shrinks from over 30% to 9.9% of GDP—the Destruction of the Middle Class of GDP—the Destruction of the Middle Class 2—Creation of Service/Financial based Bubble Economy2—Creation of Service/Financial based Bubble Economy—(DOT —(DOT COM./ENRON/HOUSING/PONZI SCHEME TYPE COM./ENRON/HOUSING/PONZI SCHEME TYPE FINANCIAL FINANCIAL INSTRUMENTS) INSTRUMENTS)

3—The Mother of all Ponzi Schemes (MADOFF NOT) 3—The Mother of all Ponzi Schemes (MADOFF NOT)

23

20

40

60

80

100

120

140

Jan-73

Mar-74

May-75

Jul-76

Sep-77

Nov-78

Jan-80

Mar-81

May-82

Jul-83

Sep-84

Nov-85

Jan-87

Mar-88

May-89

Jul-90

Sep-91

Nov-92

Jan-94

Mar-95

May-96

Jul-97

Sep-98

Nov-99

Jan-01

Mar-02

May-03

Jul-04

Sep-05

Nov-06

Jan-08

Mar-09

May-10

Va

lue

of

U.S

. Do

llar,

Tra

de

We

igh

ted

Ind

ex

Source: U.S. Federal Reserve, Nominal Broad Dollar Index (Trade Weighted Index)

Value of U.S. Dollar (1973-2010)Value of U.S. Dollar (1973-2010)(as valued against currencies of major U.S. trading partners)(as valued against currencies of major U.S. trading partners)

24

0

0.5

1

1.5

2

2.5

3

3.5

1980

1981

1982

1983

1984

1985

1986

1987

1988

1989

1990

1991

DM

/US

D

0

50

100

150

200

250

300

Yen

/US

D

Sources: U.S. Census Bureau, Pacific Exchange Rate Service

DM and Yen /U.S. DollarDM and Yen /U.S. DollarExchange RateExchange Rate(Average annual rate, 1980–1995)(Average annual rate, 1980–1995)

Plaza AccordSeptember 22, 1985

DM per U.S.D.DM per U.S.D.

Yen per U.S.DYen per U.S.D

25

0

0.5

1

1.5

2

2.5

3

3.5

1980

1981

1982

1983

1984

1985

1986

1987

1988

1989

1990

1991

0

150

300

0

75

150

225

U.S

. T

rad

e in

Go

od

s D

efic

it (

Bil

lio

ns

of

Do

llar

s)

Sources: U.S. Census Bureau, Pacific Exchange Rate Service

DM per U.S.D.DM per U.S.D.

Yen per U.S.DYen per U.S.D

DM and Yen /U.S. DollarDM and Yen /U.S. DollarExchange Rate vs. Trade DeficitExchange Rate vs. Trade Deficit(Average annual rate, 1980–1995)(Average annual rate, 1980–1995)

Plaza AccordSeptember 22, 1985

Trade DeficitTrade Deficit

26

0

20

40

60

80

100

120

140

160

Bill

ions

of D

olla

rs

1980

1981

1982

1983

1984

1985

1986

1987

1988

1989

1990

1991

U.S. Trade Deficit U.S. Trade Deficit (1980-1991)(1980-1991)

Source: U.S. Trade in Goods with World (Seasonally Adjusted) in Billions of Dollars U.S. Census Bureau

Plaza A

ccord

Plaza A

ccord

27

0

100

200

300

400

500

600

700

800

900

Bill

ions

of D

olla

rs

1980

1982

1984

1986

1988

1990

1992

1994

1996

1998

2000

2002

2004

2006

2008

2010

U.S. Trade Deficit U.S. Trade Deficit (1980-2010)(1980-2010)

Source: U.S. Trade in Goods with World (Seasonally Adjusted) in Billions of Dollars U.S. Census Bureau

Plaza A

ccord

Plaza A

ccord

US

SR

U

SS

R

Co

llapse

Co

llapse

Ch

ina p

egs ¥ to

$C

hin

a peg

s ¥ to $

Glo

ba

l G

lob

al

Re

ce

ss

ion

Re

ce

ss

ion

Impa

ct o

f Chi

nese

Impa

ct o

f Chi

nese

polic

ies

polic

ies

ChinaChina will willAccount forAccount for

almost 40% ofalmost 40% ofthe U.S. Tradethe U.S. TradeDeficit in 2010!Deficit in 2010!

28

How DO We Get Back ?How DO We Get Back ?

29

A Nation That Builds A Nation That Builds ThingsThings

Talking PointsTalking Points

30

Number One Focus Number One Focus 20102010

31

An Independent An Independent AmericaAmerica

32

Achieve Energy Achieve Energy IndependenceIndependence

• Develop ALL domestic energy resources – Traditional and Renewable

• This Will Create Jobs– Building energy infrastructure– Developing and providing energy– Securing affordable energy for American

manufacturing– Driving R&D in energy sector

33

Free TradeFree Trade

• Restore American Manufacturing by Balancing our Trade Deficit in:– Energy– Manufactured Goods

• We Must Restore Global Trade Balance:– Produce more in America– Remove barriers to American exports– Vigorously enforce Rules-Based Free Trade– STOP China’s Currency Manipulation-NOW

34

Free TradeFree Trade

• Enforcing the rules that were agreed upon is not “protectionist”!

• Counter China’s illegal trade practices and restore global trade balance

• Increase exports and remind the world that we are a nation that builds things

35

2121stst Century Century InfrastructureInfrastructure• Time to Upgrade Crumbling Infrastructure

• $2.2 Trillion needed over next 5 years– American Society of Civil Engineers

• This will create jobs through: – Building our new infrastructure– Laying foundation for tomorrow’s manufacturers

• Stimulus: Only $60 billion of $787 billion for infrastructure, and very few long-term investments or critical projects.

36

The Path Out:The Path Out:Real Wealth CreationReal Wealth Creation

Not one where we do each others laundry,• Or Sue each other,• Or Repackage phony financial instruments,• All to create PONZI or Phony Wealth or Transfer of

Wealth• All of which eventually causes Bubble implosions as

we have seen repeatedly over the last two decades.

37

• The idea that we could be successful and create better tomorrows by having little or no manufacturing and all services, IS A FAILED THEORY—A MISERABLY FAILED MINDSET AND ECONOMIC MODEL!

• Real and lasting wealth is and always has been created by making and building things and servicing the goods producing sector NOT by a predominance of servicing services!

The Path Out:The Path Out:Real Wealth CreationReal Wealth Creation

38

Number One Focus Number One Focus 20102010

39

An Independent An Independent AmericaAmerica

40

40

Nucor’s Best Years Are Ahead Of Us