Local survey reflects growing national optimism in manufacturing sector
Manufacturing-related businesses continued to improve in December, according to the latest business survey by the Milwaukee chapter of Institute for Supply Management. The seasonally adjusted index for the Milwaukee area rose to 62 in December from 59 in November – a score above 50 represents an expanding economy.
New orders received rose five points to 67, and backlog rose six points to 54.
Inventory levels dropped six points to 53, and supplier lead times dropped six points to 30 in December, most likely because of the increase in orders.
Both blue collar and white collar employment were at 57 for December.
The Milwaukee survey reflects a growing optimism among manufacturing executives around the country, according to the national Institute for Supply Management December 2010 semiannual economic forecast.
The survey shows that many executives in purchasing and supply management roles expect that the economic recovery that started in mid 2009 will continue in 2011. Revenues are expected to increase in 16 of 18 industries surveyed, and business investment is expected to substantially increase in the manufacturing sector.
"Manufacturing purchasing and supply executives have expectations for continued growth and are optimistic about their organizations’ prospects as they consider the first half of 2011, and they are even more positive about the second half," said Norbert J. Ore, chair of the ISM Manufacturing Business Survey Committee. "While 2010 has been a year of recovery in manufacturing, our forecast sees improvements in both investment and employment in 2011. Respondents expect cost pressures in 2011 to be somewhat greater than in 2010. Manufacturing growth is now in its 16th consecutive month as measured by and reported in the monthly Manufacturing ISM Report On Business."
About 65 percent of respondents expect revenues to increase an average of 5.6 percent in 2011 over 2010. Industries with the most robust growth expectations primary metals, fabricated metal products, petroleum and coal products, apparel, leather and allied products and transportation equipment. Furniture, plastics and rubber, machinery and textile mills are also expected to grow this year, the report says.
