For the second time in three months, manufacturing in the Inland Empire has hit a bump in the road.
The region’s purchasing managers index in October was 49.6, just under the 50 baseline that determines growth or reduction, according to data released this week by the Institute of Applied Research and Policy Analysis at Cal State San Bernardino.
That’s no reason to panic, because it takes three consecutive months either above or below 50 to determine if the region’s manufacturing sector is expanding or shrinking. But the index was below 50 in August – it made a strong comeback in September – and even a slight drop is reason for a little concern.
“At this point all we see is the continued volatility due to ongoing inflation, supply chain, and employment issues,” said Barbara Sirotnik, institute director and a co-author of the report, in a statement.
Production and new orders, the two key components of the index, were both down in October: 7.4 and 7.7, respectively. This was the first time since 2016 that new orders were down in October.
Employment in the Inland manufacturing sector was 57.7 last month, well within growth mode but down from 64.8 in September. The commodity price index – 65.4 – was down 10.5 month-over-month, a sign that inflation in Riverside and San Bernardino counties is easing somewhat.
The region’s purchasing managers, a pessimistic group in the best of times, was especially so in October. Fifty six percent said they expect the local economy to weaken during the next three months, while 44 percent said they expect it to stay the same, according to the report.