United Parcel Service faces a strike deadline Thursday by its drivers. After negotiating through the weekend and again Monday, both UPS and the Teamsters union reported they were still far apart on the key issues.
UPS spokesman Mark Dickens said volume has slipped in the past week as customers route packages to competitors. But with UPS handling 12 million packages a day, transportation analysts say there's only so much the competition can do.
The union granted a contract extension during the last negotiations in 1993 but so far has refused to do so.
The Teamsters, in addition to pay and pension increases, want UPS to limit subcontracting, strengthen safety and health provisions, and create more full-time jobs from its part-time positions, which comprise about 60 percent of the company's U.S. work force of about 300,000.
Consumer confidence drops
NEW YORK (AP) -- Consumer confidence fell sharply in July, following gains over the prior two months and confounding market expectations that the measure would continue to advance.
The Conference Board, a private business group, reported today that its index of consumer confidence fell to 126.5 this month from a revised 129.9 in June. Wall Street had been expecting a July reading of 130.0.
The index measuring consumers' expectations for the future fell to 107.6 in July from 111.7 in June. The index reading consumers' sense of the present situation fell to 154.8 from 157.1.
Wage costs up 0.8% in quarter
WASHINGTON -- Wages and benefits paid American workers rose a moderate 0.8 percent in the April-June quarter, the latest signal that inflation in the labor market remains absent despite the lowest unemployment levels in nearly a quarter century, the Labor Department said today.
The increase in total compensation followed a 0.6 percent rise in the first quarter this year and was in line with analysts' expectations.
The second-quarter increase in total compensation costs included a 0.8 percent rise in wages and salaries that compared with a 0.9 percent rise in the January-March quarter. Benefit costs rose by 0.6 percent in the second quarter following a barely perceptible 0.1 percent rise in the first quarter.
For the 12 months ending in June, overall compensation costs rose by 2.8 percent, down slightly from the 2.9 percent increase in the 12 months ending in June 1996.
Yields mixed on Treasury bills
WASHINGTON (AP) -- Interest rates on short-term Treasury securities were mixed in Monday's auction.
The Treasury Department sold $11.59 billion in three-month bills at an average discount rate of 5.12 percent, up from 5.11 percent last week.
An additional $12.14 billion was sold in six-month bills at an average rate of 5.15 percent, down from 5.17 percent.
The new discount rates understate the actual return to investors -- 5.26 percent for three-month bills with a $10,000 bill selling for $9,870.60, and 5.36 percent for a six-month bill selling for $9,739.60.
Separately, the Federal Reserve said Monday that the average yield for one-year Treasury bills, the most popular index for making changes in adjustable rate mortgages, fell to 5.54 percent last week from 5.56 percent the previous week.
In other business news
Cigna Corp. said Monday it will sell its individual life insurance and annuity business to Lincoln National Corp. for $1.4 billion in cash as part of its strategy to focus on corporate customers.
Air Line Pilots Association members voted 642-505 Monday against the tentative agreement reached in May with American Eagle, American Airlines' regional carrier. Both sides expressed disappointment over the rejection, but said they would continue talking.
Donna Karan will relinquish her role as chief executive of the fashion house bearing her name as part of an effort to revive the troubled manufacturer. Former Polo Ralph Lauren Corp. executive John Idol was named Monday to run the day-to-day operations at Donna Karan International.
Dell Computer Corp. jumped into the $15 billon market for workstations Monday by introducing an aggressively priced machine. Dell said its WorkStation 400 with a single 266-megahertz Pentium II processor from Intel Corp. will be priced at $3,705, while a machine with a 300-megahertz Pentium II dual processor will cost $8,078.