Orders drop, but IE manufacturing remains strong
Manufacturing in the Inland Empire continued to expand in February despite a sharp drop in new orders, according to a report.
The region’s purchasing managers index was 53.9, a slight drop from January but still above 50, the benchmark that determines if the region’s manufacturing sector is growing or shrinking, the Institute of Applied Research and Policy Analysis at Cal State San Bernardino reported.
The index has been above 50 for the last 26 straight months, meaning manufacturing and the local economy have expanded without interruption during that time.
That was the good news in this month’s report, which was released Friday. The downside was that, after 13 consecutive months of growth, the new order index dropped to 46.4, down from January’s 58.3.
Although that’s a steep drop, the report noted it’s not cause for alarm, because it takes three consecutive months in either direction to establish a trend.
Production also dropped from 58.3 to 55.4, meaning that sector is still growing but at a slower pace than it was in January.
Commodity prices and supply deliveries were up and down, respectively, while the employment index increased sharply last month, to 53.6 from 46.7 in January. Such a steep month-over-month increase might mean the January index – the first under 50 in two years – may have been an anomaly, the report stated.