Mixed signals
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Manufacturing News, Source : The Manufacturer US
Published : 07 Aug 2002 16:35
Despite encouraging signals in several areas, the economic recovery continues to struggle.
For the most part, consumer confidence remains high, and economic activity continues to climb in many areas. The Chicago Fed’s National Activity Index reached its highest level in two years in June, climbing to 0.14 from -0.04 in May. New home sales are growing, initial jobless claims are at a 17-month low, and manufacturer inventories continued their decline.
“June was a good month for manufacturing,” said Norbert Ore, chair of the Institute for Supply Management, whose purchasing managers index strengthened as 15 industries saw improvement in production. “June’s Production Index of 61.4% is the highest recorded since June 1999,” he said.
However, new orders for durable goods manufactured fell 3.8% in June, to $166.6 billion, according to the Department of Commerce. This followed a 0.6% increase in May. New orders for 2002 were 3% below June 2001.
Shipments manufactured in July were also lower, decreasing 1.4% to $173.7 billion, following May’s 0.2% decrease. Unfilled orders decreased 1.4% to $489.3 billion, following a 0.6% decrease in May.
The Chicago Purchasing Managers index also fell in June, slipping just under three points to 58.2, with new orders and supplier deliveries both declining.
Analysts continue to worry about sluggish job creation figures, which some say are not high enough to offset the 1.8 million jobs lost during the recession. Experts believe companies are reluctant to hire because of the uncertain economic outlook.
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