Plus: Leading Economic Indicators Edge Up, Jobless Claims Drop and Food Industry Sees Benefits of Standards Initiative.

Leading Economic Indicators Edge Up
The Conference Board’s index of leading economic indicators in the United States increased in September at a pace that suggests a slower growth rate in the coming months. The Leading Economic Index (LEI) rose 0.2 percent last month, following a 0.3 percent increase in August.

Although the index has risen five consecutive months, the LEI data also show weakening growth, with just half of the 10 indicators posting an increase.

“The weaknesses among the leading indicator components have become slightly more widespread in September,” according to Conference Board economist Ataman Ozyildirim. “The slow pace in the LEI suggests a growing chance that this sluggish economy is going to be here for a while.”

Last month’s LEI increase, the lowest since a decline in April, matched economists’ projections, according to the median forecast in a Bloomberg News survey. The Conference Board’s Coincident Economic Index, which measures current conditions, inched up 0.1 percent in September, while the Lagging Economic Index climbed 0.2 percent.

Jobless Claims Hit Six-Month Low
New initial jobless claims fell in the latest week reported. According to the U.S. Department of Labor, seasonally adjusted unemployment claims for the week ending October 15 fell by 6,000 to a total of 403,000, down from the previous week’s total of 409,000, which was revised upward from an initial reading of 404,000. The four-week moving average dropped 6,250 to 403,000, the lowest level since mid-April.

“Initial claims dropped 25,000 between the September and October survey periods, suggesting a step-up in non-farm employment after payrolls increased 103,000 last month,” Reuters reports. “After spiking in mid-September, jobless claims appear to have settled near the 400,000 mark that is usually associated with some improvement in the jobs market.”

Despite offering some positive signs for labor conditions nationwide, the drop in claims fell short of expectations, as economists polled by MarketWatch had forecast the total to fall to 400,000 for the week. During periods of rapid economic growth, weekly jobless claims typically remain near 300,000.

“[T]he economy continued at a near-stalled pace during the month, as governments at all levels continued to pare workforces under budget-cutting pressure while businesses stayed cautious about hiring,” Agence France-Presse reports. “Economists expect the total unemployment rate to remain at 9.2 percent, and the average estimate for net new jobs created is 84,000, not even keeping pace with the growth of the working age population.”

Bio-Based Venture Funding Likely to Slow
Following several years of booming growth, venture funding for the bio-based materials and chemicals industry appears to be drying up, requiring start-ups and investors to rework their strategies to tap into new financing opportunities. A recent report from Lux Research found the industry received $3.1 billion in venture funding over the last seven years, but that rate is unlikely to continue in the future.

The bio-based materials and chemicals industry uses biomass to replace petrochemicals in various chemical products. Between January 2004 and September 2011, there were 177 venture transactions among 79 companies in the industry, while another 49 received funding from alternate sources. However, a wave of recent IPOs and multi-billion-dollar transactions indicate the industry has matured past the point of widespread venture funding.

“The industry no longer offers daredevil innovators grand challenges that attract risk capital and venture finance,” Mark Bünger, a Lux Research director and lead author of the report, said in an announcement of the findings. “Its challenges today lie in day-to-day dilemmas of running a mature, mundane business, and the payoffs are more predictable. That doesn’t mean the field is dead; on the contrary, it means it has survived its pre-commercial childhood and is now highly relevant to corporations, regulators, and consumers.”

A result of this maturation is that many firms that received initial funding to tackle wide-scale global problems, such as climate change or oil depletion, have narrowed their focus to more specific market areas, such as creating greener consumer products and packaging.

Food Industry Reports Benefits of Standards Initiative
Dozens of major foodservice companies are seeing measurable benefits as part of the Foodservice GS1 US Standards Initiative, a voluntary, collaborative industry effort launched in 2009 to address inefficiencies in the foodservice industry and supply chain.

GS1 standards provide a common platform for structuring and sharing product information globally. For the past two years, the industry-driven initiative has accomplished a number of key deliverables. It has developed foodservice-specific implementation guides, identified foodservice workflow scenarios within the GDSN, and defined key product data attributes relevant to the foodservice industry.

According to the GS1 US earlier this month, the industry has now passed the halfway mark on the way to a 75 percent voluntary adoption of GS1 standards by 2015 (measured by revenue). To date, companies composing 55 percent of the foodservice industry’s manufacturer revenue and 45 percent of the distributor revenue are using GS1 standards.