>> the job market does look like its starting to build some foundation. we've now seen six of the last seven weeks of the initial jobless claims numbers be under 400,000. >> tom: the number of americans filing for first time unemployment benefits continues falling down to the lowest level in more than three years. >> suzanne: but one place likely to see big job cuts-- the u.s. military. with the iraq war winding down, thousands of military jobs could disappear over the next few years. it's "nightly business report" for thursday, december 22. this is "nightly business report" with susie gharib and tom hudson. "nightly business report" is made possible by:

captioning sponsored by wpbt >> tom: good evening and thanks for joining us. susie is off this week. my colleague suzanne pratt is with us tonight. suzanne, after weeks of deadlock, it looks like we could finally see a deal on extending the payroll tax cut. >> suzanne: tom, it came late today with house speaker john boehner agreeing to another vote on the senate's plan for a two- month extension. if that vote fails tomorrow, payroll taxes will go up january 1 from just over 4% to 6.2%. >> tom: that works out to a difference of about $40 a week for most workers.

>> you know, when everybody called for a one-year extension of the payroll tax deduction, when everybody wanted a full year of extended unemployment benefits, we were here fighting for the right things. it may not have been politically the smartest thing in the world, but i'm going to tell you what-- i think our members waged a good fight. we were able to come to an agreement. we were able to fix what came out of the senate. >> so we're close to a second vote here. darren gersh joins us with with the latest. a vote as early as tomorrow, is that right? >> reporter: that's right. what you just heard the speaker doing in politics is putting a lot of lipstick on the pig. this morning, there must have been some kind of record set, because this morning the speaker came out and insisted that the house wanted the senate to come back and work on a one-year extension. then this evening, the speaker

basically said the political pain had gotten too much, threw in the towel, said he agreed to what the senate would do. now they're going to do what is called a unanimous consent agreement tomorrow in the house. if anybody objects, they all have to come back next week and pass it. >> certainly they're going to have to do something by the end of february as well at this point if they do approve it, correct? >> reporter: that was the issue all along because of the fierce negotiating and some of the positions that the house took that were untenable for the president. they needed more time to work out an agreement. that's yet two-month extension. >> darren, our bureau chief in washington, we'll be back later on in the program with an update on military spending as the troops come home from iraq. >> suzanne: it looks like the u.s. job market is finally perking up, as fewer people filed for first-time unemployment checks. jobless claims fell to 364,000 last week, a three-and-a-half year low. but can the momentum continue

into the new year? to find the answer, erika miller visited one new york firm that has unleashed a rabid expansion plan. >> reporter: these may be tough economic times, but these pampered pooches are not feeling the bite. dogs like woof spend their days at spot experience, a luxury doggie daycare. mitch marrow, a former nfl player turned hedge fund manager, owns the business. >> in general, people treat their pets like a member of the family. they are not going to cut back on their children's care, and they look at their pets the same way. >> reporter: that helps explain the expansion of the business from two locations to six this year, and the hiring of 85 new workers. thanks to hiring at firms like this one, the job market is the best it has been since the end of the great recession. and many economists believe the era of deep corporate layoffs is over. first time claims for state unemployment benefits are watched closely as a barometer of layoffs. claims have declined steadily for three months to 364,000 last week. >> the job market does look like

it's starting to build some foundation. we've now seen six of the last seven weeks of the initial jobless claims numbers be under 400,000, which indicates the jobs market is starting to go into recovery mode. >> reporter: in november, the unemployment rate fell in 43 states and the district of columbia compared to the prior month. the four states you see in red had no change, and three in blue posted increases. but let's be clear-- no one is expecting hiring to be gangbusters in the u.s. in the coming months. many businesses are waiting to see a bigger increase in consumer demand before taking on new workers. other's don't need to hire because of productivity gains. and some firms that could hire won't until they get more clarity on tax policy from washington. >> there's a lot of uncertainties next year. we certainly have the u.s. government going into bickering over what will happen with the payroll tax cuts, of course, the business spending stimulus, as well. things like that could certainly unnerve businesses and keep them from hiring.

>> reporter: but probably not spot experience, which is planning to expand aggressively next year. >> we will have a minimum of 25 new locations open by the middle of 2013. we're planning on and we're budgeted for a minimum of 500 new employees, not including senior level management. >> reporter: you might even say the firm is marking its territory in a dog eat dog industry. erika miller, "nightly business report," new york. >> suzanne: joining me now with his take on the job market is brian hamilton, founder and c.e.o. of sageworks, a financial information firm ryan welcome to the program. >> great to be here. >> gotta love that story, but i gotta ask you, the hiring that we were talking about now, is this seasonal or is there something really going on here that's worth noting? >> right, good question. we have to remember that the jobs trend is going to follow the revenue trend. and there are 27 million privately held companies out there, and they have revenues

growing for the past 14-16 months. so once they get comfortable and they can forecast, they will hire people. we don't know exactly when but there seems to be a positive trend developing. >> do you have a sense of where that hiring is going to happen, what types of industry? we see this doggie daycare, but will it be service? where do you think we're going to see the jobs? >> we tracked 1400 industries and two years ago-- it's a great question-- because two years ago, almost every industry had sales declines. right now, almost every industry is growing, even residential real estate, by the way, which say shocker, right? so, you know, there are some industries that are recession-proof but we're seeing a broad, slight recovery, and once that continues, we hope, people will hire people, obviously. >> what is the primary roadblock to hiring right now for small companies, the ones that you talk to. >> right, what it always is-- comfort around revenue. by the way, in your previous

segment, it's very interesting to me. we always make the assumption that washington can do something to turn things around. i think that sometimes true, but really, business people, these 27 million people who run companies, look at their revenues, their profits, and their profit margins. once they get comfortable, they hire, and, remember, the historic precedent here, back in the early 70s-- i remember those days-- there was a 33-month lag between g.d.p. growth and job creation. so right now, we're about 14, 16 months into a slow recovery, so at some point, you know, these businesses should hire people. >> so one last quick question, something like an extension of the payroll tax, news on that, concrete news, does that matter for hiring, do you think? >> it's very interesting. i think. i don't think it's a major issue. there's a ton of dialogue in the political world around it. there should be. i think there are definitely things politicians ould not

do. i think it's going to help because it will reduce costs for these businesses. they'll make more money, and they can invest more money. that's common sense. but i don't think it's a huge issue. we have to look at long-run revenue growth because businesses look at that before they hire people. >> thank you so much for joining us. >> thank you very much. >> our guest, brian hamilton, c.d.c. of sageworks. >> tom: still ahead, buy a bracelet, fund a small business. our series "conscious capital" continues with c.e.o. of starbucks about his campaign, create jobs for usa. with u.s. troops now out of iraq, the pentagon is finishing work on a sweeping review of america's military role around the world. the report on strategic choices is due out next month, and will detail the tradeoffs that might have to be made as congress prepares cuts in defense spending. darren gersh takes a look at the challenges facing the u.s. military after iraq. >> reporter: now that the colors have returned from iraq, the military is preparing to make

difficult decisions. hundreds of thousands of troops are likely to be cut, and defense analyst loren thompson says that's just the beginning. >> when you go into a withdrawal from a war and the coming of peace, there are adjustments that have to be made in the size of the force, in the composition of your investment budget, in the number of bases you operate. it is a huge change, and it is going to take the better part of a decade to unwind. >> reporter: in the process, the u.s. military may look very different. troops and ships stationed in europe could come home. the u.s. could seek more financial and military help from allies. former assistant secretary of defense lawrence korb says other big changes in commitments and investments might be forced on the pentagon. >> basically, change has to come from the outside, because they are risk averse and they see, "well, let's just keep doing the things that we're doing." and if you left it up to the military, what they would do is keep the same budget shares they have between army, navy, and air

force. >> reporter: the strategic challenge from china is perhaps the best example of how the military must change. the chinese have developed missiles and other technology that may deny u.s. forces access to the region in the event of a conflict. that will require the u.s. to develop new strategy and tactics. but it may also lead to new thinking about how to engage with china. >> some people would say that this is mainly an economic threat, and we need to focus more on fixing our economy than putting a few more warships in the western pacific. >> reporter: if the new threats are indeed economic, the u.s. military clearly has its work cut out for it. the american enterprise institute's thomas donnelly says the $806 billion spent in iraq strained military resources just as our economy fell into the great recession. >> we come out of this with a much degraded industrial base to leap off of, uncertainty about what we want to do, and less

money. so the situation after iraq and after afghanistan, i think, will be much murkier and will be much more uncertain, both in a strategic sense, but also in a defense industrial sense, as well. >> reporter: with automatic spending cuts set to take effect in 2013, the military is now competing with the rest of the federal budget for money. >> the future, basically, of the u.s. military-- our military power, defense industry-- is ineluctably tied to the question of entitlements. if that's not tamed, there just won't be money left over for anything else. >> reporter: and the pentagon's plans will require a great deal of money. adjusted for inflation, the u.s. is spending more on defense than it did during the height of the reagan buildup. darren gersh, "nightly business report," washington. >> suzanne: he's been accused of bilking billions of dollars from investors and claims he has amnesia. but alleged ponzi schemer allen

stanford has been declared competent to stand trial. after a three day hearing in houston, a federal judge today ordered stanford to face a jury starting january 23. andrew schneider has more from houston public radio. >> reporter: stanford had been declared incompetent early this year due to an anti-anxiety drug addiction he developed while jailed in houston, and was treated for eight months at a federal prison hospital in north carolina. prison hospital officials said stanford is competent for trial. however, medical experts who testified for stanford said a brain injury the financier suffered in a jail fight has left him unable to aid his own defense. andrew schneider, "nightly business report," houston. >> andrew will keep an eye on that hearing for us when it gets under way on january 23. tom, what's on tap in tonight's market focus? >> tom: after the big gain of the blue chips we saw earlier in the week, we've been able to add to them, suzanne. let's go ahead and roll with tonight's market focus.

>> tom: some optimism about the u.s. job market helped stocks push higher, with the blue chips up for the third consecutive session. here's today's rundown. the dow industrials added almost 62 points, the nasdaq gained 21 and a half, the s&p 500 closed higher by more than ten points. big board volume was light-- 771 million on the big board. only one and a half billion shares traded on the nasdaq. financial stocks led the way higher today, up 2%. energy and technology sectors gained about 1% each. energy stocks were higher, along with crude oil, finishing just below $100 per barrel. with the better-than-expected picture of employment developing, we've seen oil prices firm up. meantime, it was a merger in technology that helped that sector out. cloud computing has been the hot tech sector for buyouts this year, and it continues to be. akamai makes gear to speed up the delivery of internet content, and today, it is the

latest to expand in the cloud. shares of akamai shot up more than 18.5%, illustrating how much investors like this deal. akamai is buying cotendo for $268 million in cash. cotendo makes software to speed up mobile networks. analysts say the deal has akamai buying out a potential competitor. speaking of buyouts, the new york stock exchange got the okay from the u.s. justice department for its merger with deutsche boerse. shares were up 1.5%, even though the deal still faces big questions in europe. in order to get the u.s. okay, the exchange agreed to sell its stake in a competing electronic exchange. even in bankruptcy, american airlines will be buying some new airplanes. the judge overseeing its reorganization okayed amr's plan to buy 200 boeing planes beginning this year. shares of american's parent company continue trading, even though the company is in bankruptcy. the stock was up.

boeing, meantime, gained 1%. not a very jolly holiday season for greeting card company american greetings. the stock was crushed today, losing almost a fifth of its value. higher costs in the past quarter hurt its profit margins. analysts and investors aren't convinced of the company's strategy to focus on products sold in dollar stores. and that's tonight's "market focus." >> tom: the week between christmas and new year's has become a big week for auto sales. it could be a strong finish to

what has been a steadily improving auto sector. as we continue our partnership with planet forward, the george washington university social media project, frank sesno explains how auto makers are using new, greener buildings and production techniques. >> reporter: if cars are polluters, than car plants are even worse, right? not so much anymore as carmakers go green. planet forward gw students sara snyder and bridgett lynn were given a close-up view of the new vw plant in chattanooga, which is the first leed platinum auto plant in the world. leed is a rating system for sustainable building. the two students uploaded their work to planet forward, and here's just one innovation they found at the plant. >> vw now has a four-coat paint process. they eliminated the primer coat to save energy and paint. >> reporter: another way vw saves energy and money? >> the chattanooga plant loads 550 to 600 cars out of the facility daily. 85% of the cars use rail instead

of trucks, which cuts down on environmental costs. on average, trains are four times more fuel efficient than trucks. >> reporter: volkswagen isn't alone in building an environmentally friendly auto plant. at a subaru plant in indiana, nothing goes into a landfill. general motors opened their gold leed certified plant in 2006. toyota, honda and bmw all have multiple plants that are leed certified. why all this green activity? it helps with the bottom line since efficiency equals savings, and going green has become synonymous with corporate responsibility and good marketing. >> franks so no joins us from our washington, d.c. bureau. kind of an interesting plant. is it as much about marketing as it is about the money? >> there's a lot about marketing. there's just no question about that. volkswagen is very anxious to

present itself as green, as innovateig. it's the first platinum leed auto plant in the world. they also say it's a money issue and it can save a lot of money. >> tom: how much. how long does it take to get the return? >> if you do the math based on platinum leed, it's supposed to safe $60 per square foot, over 20 years, this plant, this leed certification could save them as much as $100 million over that period of time. that's substantial savings and more than pays for the investment. >> tom: pull out beyond you ought on making here. have we seen these types of practices begin to be incorporated in the d.n.a. of business models? >> tom, i think that's what's really changing here. i have spent a lot of time looking at this stuff, and whether it's the auto industry, big companies like wal-mart, company companies like fedex, all are incorporating green technology and practice into their business, because it goes to the bottom line, because it

also goes to the marketing line, and because the public itself is becoming more accustomed to wanting to know what they're doing on this front. i think things are changing for the good and the long term. >> tom: frank, we'll leave it there. frank sesno, with the planet forward project. >> suzanne: here's what we're watching for tomorrow we'll see the latest on big ticket purchases with december's durable goods orders, as well as november data on new home sales and personal income and spending. also tomorrow, our friday "market monitor" guest is closed-end fund specialist thomas j. herzfeld. he's president of thomas j. herzfeld advisors. walmart has pulled popular baby formula enfamil off its shelves following the death of a missouri infant. the baby died sunday from a rare infection, and health officials are still testing for the cause. meade johnson, the manufacturer of the powdered formula, claims tests on the food were negative. the move by walmart affects only the 12.5-ounce powdered enfamil

for newborns. if you use the product, check with your local walmart. >> tom: some online shoppers may put best buy on the naughty list this holiday season. some orders placed on bestbuy.com in november and december may not make it in time for christmas. the company blames overwhelming demand, but best buy won't say how many shoppers were impacted or which products are out of stock. analysts don't expect this to cause a big hit to the retailer's bottom line this quarter. instead, the worry is it will push online shoppers to different stores in the future.

>> tom: all this week, we've been looking at small businesses doing well by doing good. tonight, our focus turns to a big business that's helping fund small business. starbucks began its create jobs for u.s.a. campaign early last month. customers get a wristband when they donate $5 or more to help fund small business lending. as our series "conscious capital" continues, we spoke with starbucks c.e.o. howard schultz, beginning with an update on his jobs for u.s.a. effort. >> we've raised almost $2 million, which has a multiplier effect by almost seven because of how much money can be raised in addition to the money we've raised side by side, and i think over 300,000 people wearing the wrist bands that we have in our stores, and i think most

importantly, we're getting the money into the hands of small businesses who, unfortunately, do not have access to credit. >> tom: this comes up to an interested point, howard, and that is, what role does a public company that essentially is in the restaurant and services industry have raising money for business lending, what has traditionally been a financial services and banking industry roll? >> i feel very strongly that washington has let us down. i don't want to be a bystander and watch america drift towards mediocrity. and i want starbuckss to be the kind of company that perhaps can be a model for others to say we can can make a difference and at the same time, we can build shareholder value. starbucks is having a record year, record revenue, record profit, our stock is close to the all-time high, and yet we're doing the kind of things not only to the communities we serve but at the same time, giving health care to every single employee. >> tom: some would point out it is that success you are having on the bottom line that allows starbucks to make the contributions on the benevolent

side of the social ledger. >> i think the consumer wants to support those companies or products whose businesses they trust and whose values are compatible with their own. and at the same time, i think business has to recognize we are in business to make a profit and build shareholder value. >> tom: according to associated press, the corporation starbuckss spent over $100,000 lobbying in the third quarter on such things as health care, food labels, and debit card fees. is business too influential in politics in your estimation? >> we have are a for-profit corporation, and we have issues we need to look at. spending over $4 billion and $6 billion to be spent on this election cycle there is something significantly and seriously wrong with the system, and i don't want to be a part of it, and i think most americans s are disgusted by it. >> tom: couldn't you argue, howard, it's a market economy when it comes to politics? >> i think it is a market

economy that needs reform. i think it needs balance. and i think most importantly, we have a crisis of confidence in this country because we have a crisis of leadership across the board. because i want america and the people who are being left behind to have a voice, and i'm not satisfied with the direction and the leadership that we are receiving. >> tom: howard schultz with us this evening. he is the chief executive officer of starbuckss. >> suzanne: and tom, we continue our look at conscious capital tomorrow with a look at the state of giving. that's "nightly business report" for thursday, december 22. i'm suzanne pratt. good night, everyone, and good night to you, too, tom. >> tom: good night, suzanne. i'm tom hudson. good night, everyone. we hope to see all of you again tomorrow night. "nightly business report" is made possible by:

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