Sector saw growth in December

Robust hiring in manufacturing and construction fueled national job gains in December, according to the U.S. Department of Labor.

U.S. employers added 155,000 jobs in December, as the national unemployment rate remained at 7.8 percent. Manufacturers added 25,000 jobs, the most in nine months.

Meanwhile, the Institute for Supply Management-Milwaukee reported the Milwaukee-area manufacturing sector grew in December for the first time in five months.

The ISM’s seasonally adjusted Purchasing Managers’ Index (PMI) was 52.2, up from 45.3 in November. A reading above 50 indicates growth.

Production jumped 16.8 percent in December and employment was up 7.3 percent. The blue collar employment diffusion index was 52.7 percent, up from 50 percent in November. White collar employment was at 60.2 percent, up from 52 percent last month.

New orders, prices, exports and imports were growing, while inventories, customers’ inventories and backlog of orders were declining.

Survey participants had the following comments regarding the local manufacturing industry in December:

  • “Long lead times and poor sales forecasts create customer service issues tied to reaction time to service”
  • “Customers with poor forecasting capability and short lead-time expectations”
  • “Our business is cyclical, and down period runs from November until March—seasonality would cover any decreases”
  • “Supplier deliveries adversely impacted by port strikes”
  • “General (upward) creep in steel prices—and, prices of proteins have increased (beef, pork and chicken)”

In the six-month outlook, 33 percent of respondents expected positive conditions, up from 24 percent in November; 50 percent expected the same conditions, up from 36 percent last month; and 17 percent expected worse conditions, up from 40 percent in November.

Respondents made the following outlook comments:

  • “Orders for second quarter look better”
  • “Economic uncertainty is affecting municipal sales”
  • “December has never been as strong a month as it has been this year. We expect the beginning of the new year to be strong as well”

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