Manufacturers reported a fourth consecutive month of expansion in June, and their outlook for increased production and hiring is upbeat for the rest of 2014, according to the monthly survey by the Federal Reserve Bank of Philadelphia that includes five counties in South Jersey.
The Fed said manufacturers reported that employment, new orders and shipments were positive for the fourth straight month, and they are more optimistic for continued growth over the next six months.
The survey includes all of Burlington, Camden, Gloucester and Salem counties and part of Mercer.
The Fed's index of general activity increased from a 15.4 in May to 17.8 in June — that is the highest reading since last September.
Michael E. Trebing, senior economic analyst at the Philadelphia Fed, said a large percentage of the firms, about three-quarters, say they expect to increase production in the second half of the year. Nearly 30 percent said they would hire additional workers; 28 percent said they would increase the productivity of their existing workforce without hiring; and 12 percent expect to increase the hours of existing staff without hiring additional workers.
“Since many of the firms that plan to increase production are doing this with current staff or by increasing hours, we know there is still excess capacity in manufacturing,” Trebing said.
The Fed report said labor market conditions improved in June, when its employment index was positive for the 12th consecutive month and increased 4 points. The survey found 22 percent of firms increased employment in June, while 11 percent reduced their workforce.
Rutgers economist Jim Hughes said the survey results bode well for New Jersey.
“The Fed report suggests employers are optimistic about the future."
He said the Philadelphia Fed Index “has been improving for four straight months and that may well be a signal" for positive growth in the second half of the year.
ALSO ON NJBIZ:
Please note: All comments will be reviewed and may take up to 24 hours to appear on the site.View Comment Policy