Slowdown continues into February
By Don Hogsett -- Home Textiles Today, 3/17/2003 12:00:00 AM
TEMPE, AZ —
U.S. manufacturing grew modestly for a fourth straight month during February, but at a substantially slower pace than before, reflecting business leaders' concerns about a widespread economic malaise and the possibility of a war with its attendant disruption of business.
A key report from the nation's purchasing managers said their monthly gauge of manufacturing activity stood at 50.5 percent – still growing, if just barely, and well beneath the level of 53.9 reached the month before.
"The manufacturing sector continued to grow in February, but the rate of growth slowed when compared to January," said Norbert Ore, chairman of the Institute for Supply Management's Business Survey Committee. "While production remained strong, there was a significant slowing in the rate of growth of new orders. Manufacturing jobs continue to decline as the Employment Index's rate of decline accelerated."
Still showing notable resilience, the purchasing managers' Production Index held relatively steady at 55.4, declining just 0.9 percentage points from 56.3 in January. A reading above 50 indicates growth, while a reading beneath that level signals a decline.
A total of 11 manufacturing sectors out of 19 canvassed recorded growth in February, including the textiles and apparel industries.
But raising a question about future production, the New Orders Index, while still growing, slumped significantly, to a level of 52.3, down sharply from 59.7 in January. Both textiles and apparel registered declines in new orders.
Raising some concerns about profitability of American manufacturers going forward, the prices they pay for their raw materials jumped up sharply in February, with the Prices Index climbing to a reading of 65.5, up eight percentage points in February. Textiles was among the industries reporting higher prices, as the price of cotton continues to climb.
month-over-month percentage-point change
|Source: Institute for Supply Management
|Purchasing Managers Index||-3.4|
|Prices manufacturers pay||+8.0|
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