Employment activity leads expansion in business activity
The Composites Fabricating Index for June 2019 came in at 52.7, continuing its stretch of more than 30 months of expanding activity.
The Composites Index finished June at 52.7, marking more than 30 consecutive months of expanding composites industry activity, by far the longest stretch in the history of the Composites Index. The latest Index reading is 7.0% lower compared to the same month one year ago. The Index has reported a trend of slowing growth since reaching a peak in April 2018. Index readings above 50 indicate expanding activity, while values below 50 indicate contracting activity. The further away a reading is from 50, the greater the change in activity. Gardner Intelligence’s review of the underlying data revealed that the Index was propelled by a surge of employment activity followed by increased activity in supplier deliveries and production. The Index — calculated as an average of the components — was pulled lower by modest expansions in both backlogs and new orders, as well as contracting exports activity.
The spread between employment and production activity widened during the second half of 2018 and early 2019. Recent months of data have seen employment activity improve, with the gap between employment and production activity closing in June.
June’s data indicated that production and new orders continue to report strong expansion despite the fact that most other manufacturing technologies have experienced slower activity levels. Recent months of strong employment data may be the result of the need for additional labor to maintain production activity levels, which remained well above long-run levels through June.
More information about the Composites Fabricating Index can be found at http://www.gardnerintelligence.com/.
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