U.S. manufacturing corporations' seasonally adjusted after-tax profits in the fourth quarter of 2022 totaled $235.4 billion, down $7.9 (±2.8) billion from the after-tax profits of $243.3 billion recorded in the third quarter of 2022, and down $35.0 (±1.5) billion from the after-tax profits of $270.5 billion recorded in the fourth quarter of 2021. Seasonally adjusted sales for the quarter totaled $2,072.3 billion, not statistically different from the $2,111.3 billion in the third quarter of 2022, but up $148.4 (±28.3) billion from the $1,923.9 billion recorded in the fourth quarter of 2021.You can see that dollar amount of sales went up in 2022, but profits went down, which indicates that higher costs hit manufacturers last year. But what's not mentioned is that 2021 featured an 80% increase in post-tax profits from the end of 2019 to the 3end of 2021. and manufacturers were still in much better shape at the end of last year than they were in the pre-COVID era. On the retail side, you can see that other than a few months at the start of the pandemic, retail had steady increases in sales throughout this time period through the middle of last year. And that profits significantly declined in 2022, indicating a large increase in costs that started in mid-2020 and continued through most of 2022, likely reflecting increases in wages required to keep workers in those high-contact jobs.
So let's not kid, even if the profits of these businesses were declining in 2022, they're coming off ridiculous highs from 2021. Manufacturers (especially) are doing just fine these days, but retailers are seeing some stresses. The positive in both of these things is that workers seem to have received a small share of the higher profits of 2021, but "inflation" still has been a nice boon to corporate profits in the last two years, and we will likely see more evidence of that when the Bureau of Labor Statistics releases its year-end info on all corporate profits later this week.
The company is using the boost in revenue to lavish its investors and executives.— More Perfect Union (@MorePerfectUS) March 23, 2023
General Mills has already spent $1.1 billion on buying back their own stock.
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