According to the latest Business Outlook survey, 30 percent of the region’s manufacturers indicated business declines between Dec. 19 to Jan. 15, exceeding the 24 percent that reported increases and plunging the bank’s activity index from a 4.6 reading in December to a -5.8 reading for January.
In response to low demand for new orders and shipments, 16 percent of the manufacturers surveyed said they decreased their workforce through Jan. 15, outpacing the 11 percent that added employees within that time period.
“In regards to the storm, we’re still seeing a negative impact on industry employment,” said Michael Trebing, an economic analyst for the bank. Last week, December’s employment index was revised from 3.6 to -0.2 to reflect that a greater share of manufacturing firms decreased employment than those that hired workers throughout the month.
But according to the New Jersey Department of Labor and Workforce Development, manufacturers statewide expanded payrolls by 3,000 jobs in December — the industry’s strongest monthly employment gain in 2012, compared to the 200 manufacturing jobs added in November and the 900 jobs added in September.
However, the bank’s latest survey captured the first half of January, which suggests there was a decline in employment at manufacturing firms over the past three weeks that could show up in January’s state employment data when it’s released next month.
Looking ahead through July 2013, 22 percent of manufacturers expect to add more workers, though the firms indicated uncertainty surrounding federal fiscal policy, health care costs and sales growth are restraining their hiring plans.