Report finds continued expansion in area
Area manufacturing activity continued on an upward trend in February as the Milwaukee-area PMI came in at 55.22, up almost five points from January.
The index is part of the Marquette-ISM Report on Manufacturing. A reading above 50 indicates growth in the industry while a reading below 50 indicates contraction.
The index was at 50.36 in January after nine straight months below 50.
Nationally, the manufacturing industry has had mixed results in recent months. After adding just 30,000 jobs in 2015, the industry added nearly that many in January alone. While some companies have reported record revenue and profits, others, particularly those with connections to oil and gas or energy markets, have struggled. Additionally, companies with significant parts of their business relying on sales to customers outside the United States have reported currency exchange rates reducing their sales figures because of the strong dollar.
Despite the improved reading, comments from respondents to the Marquette-ISM survey were a mixed bag. One responder noted that some are forecasting an upward trend in the future, but another said there is not much certainty about what the future will hold beyond the next 60 days. One commenter said a lot of new products were being unveiled while another said business seems to be flat or slower than last year.
The six-month outlook on business conditions improved slightly in February to a diffusion index of 70.8 percent. The index attempts to eliminate bias towards positive or negative expectations. In January, the index was 69.2 percent. The percentage expecting better conditions moving forward actually dropped in February from 46.2 to 41.7 percent, but those expecting conditions to stay the same grew from 46.2 percent to 58.3 percent. No respondents said they expect conditions to get worse.
The Marquette report’s more detailed look at manufacturing showed growth in new orders, production, employment, inventories, customer inventories, exports and imports. The report found prices and backlog of orders declining.
