Jobless Rate Rises to 4.8% in California
California's unemployment rate edged up to 4.8% in April, marking the first time in six years that joblessness statewide increased for two consecutive months. The statistics provided evidence that the U.S. slump, together with the state's energy and high-tech troubles, have begun to sharply slow down business in much of California. Still, the state gained 17,300 jobs in April, an impressive figure when compared with a loss of 223,000 jobs nationwide. The jobless rate in Los Angeles County jumped to 5.1% from a revised 4.9% in March.
Consumers Give Economy a Big Boost
Signs of renewed strength in the economy trimmed hopes for aggressive interest rate cuts by the Federal Reserve and sent U.S. Treasuries sharply lower Friday. Stocks declined modestly. Consumers picked up spending in April even more than expected, retail reports showed, and their confidence in the economy took a big positive turn in May after months of decline. Meanwhile, inflation at the wholesale level remained tame during April, with the producer price index up a less-than-expected 0.3%, the government said. Earlier in the week, a report of lower productivity accompanied by rising labor costs had fueled fears of higher inflation, but economists said the Fed probably would continue to aim its interest rate policies at heading off a recession rather than at nipping inflation.
Times Staff Writers
Northrop Makes Rival Bid for Newport News
Northrop Grumman Corp. made an unsolicited $2.1-billion bid to buy Newport News Shipbuilding Inc., hoping to undercut a planned purchase of the Virginia ship maker by its archrival, General Dynamics Corp. The Century City-based defense contractor offered $67.50 a share, the same price proposed by General Dynamics, although Northrop's deal would consist mostly of stock. The audacious move came less than two weeks after the boards of both Newport News and Falls Church, Va.-based General Dynamics approved their pact and less than a day after General Dynamics began the tender offer to the shareholders. Either winner, if it can overcome federal antitrust concerns, would become the nation's largest builder of military ships.
Boeing Chooses Chicago for New Home Base
The Windy City beat out Dallas and Denver as the new world headquarters for Boeing Co., winning one of the most intense lobbying wars for the cachet of being named the home of the world's largest aerospace concern. Chicago was chosen two months after Boeing shocked its hometown--and corporate America--by announcing it was moving its headquarters out of Seattle, where the company was founded 85 years ago and grew to become the world's biggest maker of airplanes. Boeing said it wanted to be closer to Wall Street and politicians in Washington while giving each of its core businesses--commercial airplane making in Seattle, military jets and missiles in St. Louis and space and communications in Southern California--more autonomy.
Consumer Groups Sue Over Breast Cancer Drug
Consumer groups continued their legal offensive against the pharmaceutical industry, saying in lawsuits that AstraZeneca and Barr Laboratories Inc. conspired to inflate the price of the widely used breast cancer drug tamoxifen. The suits, part of a broader assault that has turned the drug industry into a magnet for class actions, allege that a 1993 settlement of patent litigation between AstraZeneca and Barr was a collusive agreement. Barr dropped its legal efforts to bring out a low-cost generic version of tamoxifen, and in return, AstraZeneca paid Barr $21 million and allowed Barr to sell in the U.S. an unbranded version of tamoxifen manufactured by AstraZeneca. But, according to the plaintiffs, Barr's version of tamoxifen is only 5% cheaper than AstraZeneca's branded product, Nolvadex. Generic versions of drugs typically sell for 30% to 80% less, the plaintiffs say.
A Times Staff Writer
Consumer Data Rule on Privacy Is Upheld
Credit bureaus will have to stop selling consumers' names, addresses and Social Security numbers by July under a new government regulation that was upheld by a federal judge in Washington. The rule, issued last year by the Federal Trade Commission, was challenged by credit bureaus and information brokers, which have created a robust market for the data. The judge ruled that the FTC had not overstepped its bounds. Credit bureaus are expected to appeal, which may delay implementation of the rule. Privacy advocates hailed the decision.
Bush Nominates Pitt to Be SEC Chairman