IE manufacturing continues to sink
The Inland Empire’s manufacturing sector took another major hit in April, as the full impact of COVID-19 continued to be felt.
The purchasing managers index for the fourth month of the year was 41.8, down from 43.3 in March and well below the 50 benchmark that determines if manufacturing is growing or shrinking, according to the Institute of Applied Research and Policy Analysis at Cal State San Bernardino.
How bad was last month’s index? It’s only been lower eight time since the institute began publishing it in 1993, and most of those instances were during the Great Recession of 2007-2008.
Should this month’s index fall below 50, the Inland manufacturing sector will officially be in decline, as it takes three consecutive months in either direction to establish a trend.
April’s index was expected given the extraordinary circumstances brought on by the Coronavirus, said Barbara Sirotnik, institute director and co-author of the monthly report.
“Considering the pandemic ravaging the world, it’s not a surprise that the PMI would be as low as it is,” Sirotnik said in the report. “Non-essential businesses have been shuttered, and residents in most states have been ordered to stay home.
“Another large group of individuals are now on the unemployment rolls and are barely holding on, and those people are unlikely to make any purchases other than essentials.”
Also in April, production and new orders fell to record lows, and the region’s employment index fell to a near-record low, according to the report.