U.S. manufacturing posts best quarter in 2 years: Markit

NEW YORK, Mon Apr 1, 2013 — U.S. manufacturing growth picked up in March as new orders increased and hiring quickened, closing out the best quarter for the sector in two years, a survey showed on Monday.

Financial data firm Markit said its U.S. Manufacturing Purchasing Managers Index rose to 54.6 last month from 54.3 in February. A reading above 50 indicates expansion.

Output increased, though the rate of growth slipped to 56.6 from 57.3 in February.

Overall, however, the index averaged 54.9 between January and March, above the 52.6 average recorded in the fourth quarter of 2012 and the best quarterly showing in two years, Markit said.

“The sector will have provided a firm boost to the economy in the first quarter, with output possibly growing by as much as 2 percent compared to the final quarter of last year,” said Chris Williamson, Markit’s chief economist.

Domestic demand grew steadily at the same rate as the prior month, while new export orders increased after contracting slightly in February.

The pace of hiring, however, increased, with the employment sub-index hitting 54.6 compared to 53.5 the prior month. March’s pace was swifter than the average for all of 2012.

U.S. factory activity still slow in August: Markit

NEW YORK, Tue Sep 4, 2012 – The pace of growth in manufacturing remained sluggish in August as exports declined for a third straight month and firms were slow to add new workers, a survey showed on Tuesday.

The final Markit U.S. Manufacturing Purchasing Managers Index stood at 51.5 this month, below a preliminary estimate of 51.9. A reading above 50 indicates expansion.

A slight increase in output and overall new orders helped nudge the index above 51.4, where it stood at the end of July.

But the pace of growth was still one of the weakest since the sector stopped shrinking in October of 2009. New export orders were a drag on activity, as slow or negative growth in Europe and elsewhere sapped foreign demand for U.S. products.

Mark Wingham, Markit economist, said expansion in the sector was “only modest” in August. Without a significant jump in activity next month, “third quarter manufacturing growth will likely be one of the weakest since recovery began.”

Hiring in August was the slowest it’s been since December 2010, which Dobson said partly reflected weak overall trends in output and new orders. The index’s employment component fell to 52.4 from 52.7 in July.

The U.S. government will report employment data for August later this week, and the median forecast of economists polled by Reuters is for a gain of 120,000 jobs, down from 163,000 in July.

Some analysts suspect a number below 100,000 could provoke the Federal Reserve to try to boost overall growth with another round of monetary stimulus when it meets in mid-September.

NY Fed manufacturing growth slowed in June

NEW YORK, Fri Jun 15, 2012 – A gauge of manufacturing in New York state fell sharply in June but still showed growth, the New York Federal Reserve said in a report on Friday.

The New York Fed’s “Empire State” general business conditions index fell to 2.3, a 15-point drop from the month before and the lowest level since November 2011, and far below economists’ expectations of 13.

Employment gauges also declined slightly, and indexes for the six-month outlook fell for the fifth consecutive month to 23.1, suggesting waning optimism about the medium-term.

The survey of manufacturing plants in the state is one of the earliest monthly guideposts to U.S. factory conditions.

Manufacturing up, construction spending falls

NEW YORK,  Mon Apr 2, 2012 – The pace of growth in manufacturing picked up last month, but construction spending saw its largest drop in seven months in February, pointing to an economy that is healing gradually.

The Institute for Supply Management  said its index of national factory activity rose to 53.4 from 52.4 in February, topping economists’ expectations of 53.0.

It was a rebound for the sector that in February saw the pace of growth unexpectedly slow. Even so, the forward-looking gauge of new orders was modestly weaker in March, easing to 54.5 from 54.9.

The index has been stuck in a tight range in the low 50s since last summer, pointing to steady, though slow growth for the sector.

In contrast, the euro zone’s manufacturing sector contracted for an eighth straight month in March, with the downturn spreading to core countries Germany and France.

Factory activity in China offered a brighter picture, though it was still far from robust.

“Manufacturing is still chugging along here in the U.S. even though manufacturing is in a recession in Europe and just barely growing in China,” said Christopher Low, chief economist at FTN Financial in New York.

Manufacturing, housing data flag underlying strength

WASHINGTON – U.S. manufacturing output rose solidly in January and a gauge of factory activity in New York state hit a 1½ -year high in February, showing a solid underpinning for the economic recovery.

The firmer tone was also in evidence in another report on Wednesday that showed optimism among home builders approached a five-year high this month, a good omen for the struggling housing market.

The reports added to a run of fairly upbeat data, even though overall industrial production was flat last month as unusually mild winter weather weighed on utility output.

“What we are seeing here is confirmation of the positive momentum we have seen in the economy over the past few months,” said Millan Mulraine, senior macro strategist at TD Securities in New York.

Factory production increased 0.7 percent, the Federal Reserve said, after an upwardly revised 1.5 percent rise in December. The December increase was previously reported as a 0.9 percent gain.

Manufacturing was buoyed by a 6.8 percent jump in motor vehicle output. But production at utilities plunged 2.5 percent, the second straight month of big declines.

A 1.8 percent drop in mining production, the first decline in almost a year, also helped damp industrial output last month. However, overall production was stronger than first thought in December, rising 1 percent as opposed to the previously reported 0.4 percent gain.

“The mining sector has been enjoying a renaissance over the past couple of years and, barring a collapse in oil prices, we expect that will continue for some time,” said Paul Ashworth, chief U.S. economist at Capital Economics in Toronto.

Manufacturing sector picks up in January, according to ISM index

NEW YORK – The pace of growth in the manufacturing sector picked up in January to its highest level since June as new orders improved, according to an industry report released on Wednesday.

The Institute for Supply Management said its index of national factory activity rose to 54.1 from a revised 53.1 the month before, falling shy of expectations for 54.5.

A reading above 50 indicates expansion in the manufacturing sector.

New orders gained to 57.6 from 54.8, while the employment index slipped to 54.3 from 54.8.

Tony Little: Marketing muscle

Tony Little, Founder, President and CEO, Health International Corp.

Tony Little, Founder, President and CEO, Health International Corp.

You’ve come up with a great idea for a product, gotten it trademarked and patented, finalized the design specifications and lined up financing and distribution. Everyone is clamoring for your gizmo. Now all you have to do is get the item manufactured and delivered to all those distributors and retailers who will be selling millions of units to eager consumers. Find the cheapest manufacturer and you’re all set, right? Well, not exactly.

As you begin your search, you’ll notice that most manufacturing these days is done outside of the United States. Typically, we’re talking about a faraway country where English is not the primary language, which can make communications difficult. When you factor in cultural differences, which can also be an issue, you’re dealing with a lot that can go wrong before the first shipment arrives at your loading dock.

In dealing with foreign-based manufacturers, I cannot overemphasize the importance of finding a liaison in the area that can be your “eyes on the ground” and function as a bridge between the company and you. You need to be able to trust this person and their organization, and that they understand your business, its goals and how you think, as they’ll be functioning in your place usually many time zones away.

As for the criteria in selecting a manufacturer, it’s really no different than choosing someone to look after your children. A great resume, recommendations from previous employers and personal references mean everything.

It is essential to think of your manufacturer as a partner in your venture, not just a vendor. This means you have to trust their opinions when it comes to their area of expertise. It’s a big mistake to just hand them specifications, walk away and expect your shipment of finished products to be perfect. I look at it as a team effort. If they make suggestions on how to execute my product, I always take the opportunity to listen. If it sounds reasonable, I almost always let them do it. Of course, take the time to see and test a final product sample before giving your final OK.

I had a shoe product a few years ago that was extremely successful — a sandal made of ethylene vinyl acetate (EVA). In a rush to make an on-air sales date that was expected to generate huge sales, we decided to change manufacturers. Our existing vendor was great, but they weren’t equipped to handle that kind of volume, so we switched to a larger company that was very reputable. Despite claiming to be proficient in working with EVA, the new manufacturer had problems with the injection molding, resulting in a high degree of variability in the sandal’s arch supports. We wound up with a high return rate for the batch, which was a tremendous pain and let our brand customer down. It wound up costing us zillions of dollars, but fortunately we were able to make good on all the orders. Shortly afterward, we found a new company, but we learned a valuable lesson from the experience.

One of the biggest issues currently facing product-based companies is mounting manufacturing costs everywhere in the world. One solution for me has been to provide additional value to what I’m selling that compensates for the higher prices. For example, if I’m offering a piece of exercise equipment that has seen its price increase by say, $25 from last year because of higher manufacturing costs, it’s hard to pass that cost onto the consumer and still sell successfully. To offset that, I can include a fitness DVD, CD or computer memory stick that carries the equivalent retail value that makes up for the difference. My manufacturing costs will be relatively minimal for the additional item, but the consumer will receive more in return.

The current economy aside, there will always be challenges in manufacturing that call for a healthy balance of common sense, trust and out-of-the-box thinking, not to mention the ability to learn from one’s mistakes. Ultimately, it’s all about the golden rule of any brand: keep your customers loyal and loving you by treating them well.

There’s always a way.

Tony Little is the president, CEO and founder of Health International Corp. Known as “America’s personal trainer,” he has been a television icon for more than 20 years. After overcoming a car accident that nearly took his life, Little learned how to turn adversity into victory. Known for his wild enthusiasm, Little is responsible for revolutionizing direct-response marketing and television home shopping. Today, his company has sold more than $3 billion in products. Reach him at [email protected].

Manufacturing may help fight off new recession, September figures suggest

WASHINGTON ― Factories grew more quickly in September as production and hiring increased, suggesting that manufacturing would help keep the economy from slipping into a new recession.

Other data on Monday offered more good news for the troubled U.S. economy, with strong demand for new motor vehicles putting sales on track to surpass August’s rate, and construction spending unexpectedly rebounding in August.

“That hardly sounds like an economy flat on its back. The economy is still moving forward. But no one should confuse direction with speed,” said Joel Naroff, chief economist at Naroff Economic Advisors in Holland, Penn.

September marked the 26th straight month of expansion in a sector that has shouldered the broader economic recovery, and the factory report implied that an outright contraction in output would probably be avoided.

The Institute for Supply Management said its index of national factory activity rose to 51.6 last month from 50.6 in August, boosted by a rebound in production and increased factory hiring. But new orders fell for third month.

Economists had expected the index to edge down to 50.5. A reading above 50 indicates expansion in manufacturing.

The data was eclipsed in financial markets by Greece’s admission that it would miss its deficit target this year, which weighed on stocks worldwide. Prices of U.S. Treasury debt rallied, while the dollar rose against a basket of currencies.

Europe’s worsening debt crisis has left the U.S. economy on the edge of a new downturn. The economy grew at a 1.3 percent annualized rate in the second quarter, an improvement from the 0.4 percent in the January-March period.

The growth in U.S. manufacturing is bucking a global trend. Factory activity in Europe and Asia slumped in September to levels not seen since the depths of the financial crisis as export demand dropped.

The Global Manufacturing PMI, compiled by JPMorgan with research and supply organizations, contracted for the first time in over two years.

The Federal Reserve last month announced a new measure designed to push long-term borrowing costs lower by shifting assets on its balance sheet to help the tentative economy.

Last week, Fed Chairman Ben Bernanke said the U.S. central bank might need to ease monetary policy further if inflation or inflation expectations fell significantly.

For now, indications are that the economy will avoid a recession and remain on a slow growth track, even as weak incomes constrain consumer spending — the main engine of growth.

But households were more willing to spend on motor vehicles last month. Reports so far from General Motors, Chrysler and Volkswagen suggest sales could be about 8 percent higher than August’s on a seasonally adjusted annualized basis.

A separate report from the Commerce Department showed an unexpected rebounded in construction spending in August as outlays on state and local government building projects rose sharply.

Construction spending rose 1.4 percent to an annual rate of $799.15 billion, the Commerce Department said. Economists had forecast a 0.3 percent drop.

“Spending should rise in the third quarter as a result of post-(Hurricane) Irene repairs. Construction is set to add to GDP growth in third and fourth quarter but the sector is still very weak,” said Ian Shepherdson, chief U.S. economist at High Frequency Economics in Valhalla, New York.

Spending on non-residential structures rose in the second quarter at its quickest pace since the third quarter of 2007.

Data last week showed that cash-rich U.S. businesses continued to invest in machinery, a trend that economists expect to hold and keep the economy expanding.

Manufacturing accounts for about 12 percent of gross domestic product and almost 11 percent of nonfarm employment.

The tenor of the ISM manufacturing report was strengthened by an increase in hiring last month, which could be a good omen for Friday’s employment report.

The economy failed to add jobs in August, leaving the unemployment rate at a lofty 9.1 percent.

Other details of the factories survey showed production rebounded last month after contracting in August. However, new orders contracted for a third straight month, potentially pointing to a pullback in manufacturing in the months ahead.

“The main concern going forward would be if new orders didn’t pick up,” said Bradley J. Holcomb, chair of the ISM manufacturing business survey committee in Dallas, Texas.

But inventories are growing at a slower pace and the ISM viewed customers’ supplies as too low, which should boost future orders. In addition, orders for exports rose and suppliers are taking a little bit longer to make deliveries to manufacturers, which is also a good sign.

New orders for manufactured goods in May rise above expectations

WASHINGTON ― New orders for U.S. manufactured goods and a gauge of business spending plans rose in May, easing fears of a sharp slowdown in factory activity.

Durable goods orders increased 1.9 percent after dropping 2.7 percent in April, the Commerce Department said Friday.

Economists had expected orders to rise 1.5 percent in May.

Durable goods orders are a leading indicator of manufacturing health.

An improvement across the board in May and revisions to April’s figures, which showed smaller declines that previously reported, pointed to underlying strength in a sector that has powered the economic recovery.

The report came as a relief to investors after recent regional factory data had shown some signs of fatigue. Supply chain disruptions after the March earthquake and tsunami in Japan are constraining manufacturing.

The report was “a little better than you might have expected given the gloomy news that’s coming out of the manufacturing surveys. So that’s a small plus,” said Nigel Gault, chief U.S. economist, IHS Global Insight in Lexington, Massachusetts.

U.S. stocks extended gains on the data, while prices for Treasury debt fell.

The report also supported views the sluggish economy would regain momentum in the second half of the year.

The economy grew at an annual rate of 1.9 percent, the department said in another report, up from the previously estimated 1.8 percent. The revision was in line with economists’ expectations.

The economy expanded at a 3.1 percent rate in the fourth quarter.

Orders were a buoyed by a 36.5 percent jump in volatile aircraft bookings. Boeing received 27 aircraft orders, up from just two in April, according to information posted on the plane maker’s website.

Motor vehicle orders rose 0.6 percent after plunging 5.3 percent the previous month, suggesting some improvement in auto production, which has been hit by a shortage of parts from Japan.

Excluding transportation, durable goods orders increased 0.6 percent after a revised 0.4 percent decline in April, previously reported as a 1.6 percent fall. Economists had expected this category to rise 0.9 percent.

Outside of transportation, orders for machinery, primary metals, capital goods, computers and electronic products all rose.

Non-defense capital goods orders excluding aircraft, a closely watched proxy for business spending, rebounded to increase 1.6 percent last month after a revised 0.8 percent fall in April.

Economists had expected a 1.0 percent increase from a previously reported 2.3 percent drop.

Shipments of non-defense capital goods orders excluding aircraft, which go into the calculation of gross domestic product, increased 1.4 percent after falling 1.5 percent in April.