Tempe, AZ —Economic activity in manufacturing grew in January for the 32nd consecutive month, while the overall economy grew for the 51st consecutive month, say the nation’s supply executives in the latest ISM Report On Business. Both new orders and production remain relatively strong, and the panel of respondents is generally upbeat about their business. It appears that the sector has recovered from the disruptions and dislocations caused by the Gulf Coast hurricanes. The Prices Index rose slightly during the month; however, the list of commodities reported‘up in price’ is significantly reduced from December.
The 13 industries reporting January growth—in order—are: apparel; primary metals; miscellaneous; textiles; food; transportation and equipment; fabricated metals; electronic components and equipment; industrial and commercial equipment and computers; furniture; instruments and photographic equipment; rubber and plastic products; and chemicals.
Representative comments from respondents are:
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Sales are still strong (chemicals);
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Business was very steady last quarter of 2005, and first quarter of 2006 is also strong (electronic components and equipment);
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‘November and December sales were robust, which helped in reducing inventory for the year end (fabricated metals);
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We experienced some softness in December sales. Reason unknown at this time (food); and
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The machine tool industry as a whole remains sluggish although there is more quoting activity and there are a few bright spots on the horizon. (industrial and commercial equipment and computers).
| Manufacturing at a glance January 2006 |
| Series index | Series index | Percentage point | Rate of | Trend* | ||
| Index | January | December | change | Direction | change | (months |
| PMI | 54.8 | 55.6 | -0.8 | Growing | Slower | 32 |
| New Orders | 58.0 | 59.1 | -1.1 | Growing | Slower | 33 |
| Production | 56.6 | 57.8 | -1.2 | Growing | Slower | 33 |
| Employment | 51.3 | 53.6 | -2.3 | Growing | Slower | 8 |
| Supplier deliveries | 55.3 | 52.9 | +2.4 | Slowing | Faster | 31 |
| Inventories | 46.5 | 47.3 | -0.8 | Contracting | Faster | 10 |
| Customers’ inventories | 46.0 | 48.0 | -2.0 | Too Low | Faster | 56 |
| Prices | 65.0 | 63.0 | +2.0 | Increasing | Faster | 6 |
| Backlog of orders | 53.5 | 49.5 | +4.0 | Growing | From Contracting | 1 |
| Exports | 58.5 | 54.3 | +4.0 | Growing | Faster | 39 |
| Imports | 57.0 | 52.8 | +4.2 | Growing | Faster | 49 |
| Overall economy | Growing | Slower | 51 |
| Manufacturing sector | Growing | Slower | 32 |
| *Number of months moving in current direction Indexes reflect newly released seasonal adjustment factors. |
For more information visit: https://www.napm.org
— Richard Phelps , senior editor, Control Engineering
