Manufacturers remained upbeat in July for the fifth straight month and expect continued expansion in the next six months, according to the monthly survey of manufacturing firms by the Federal Reserve Bank of Philadelphia, which includes southern New Jersey.
Michael Trebing, senior economic analyst, said the survey revealed positive trends for key indicators: “General activity, new orders, shipments and employment were all positive again this month, suggesting continued expansion.”
“For the manufacturing sector in our district, we have had five months of positive readings on all the general broad activity indexes,” he added.
And he said in July in particular, “an improvement in new orders would suggest higher demand for manufactured goods.”
The survey found some price increases, but nothing pointing to significant inflationary pressure.
It found that 36 percent of firms reported paying higher prices for their manufacturing inputs.
“A lot of this probably has to do with energy prices that tend to be transitory,” Trebing said. The majority, or 72 percent, said the prices they receive for the products they make have remained stable.
Trebing said the survey has “very high readings for the six-month outlook. About 60 percent of firms expect growth in activity in the next six months and about 56 expect an expansion (in) orders.”
And while that doesn’t translate into increased hiring across the board, “you still have about a third of the firms indicating that they expect to expand their payrolls” over the next six months, he said, while only 3.5 percent said they will cut back on employment.
Manufacturers were asked to assess the impact of exporting on their business.
The survey found that 39 percent of the firms said their share of total export sales had increased in July, while only 7 percent said the export share declined.
Trebing said, “Although most of these firms indicated that the share increase (from exports) was moderate, still exports are contributing to the growth of the firms that are exporting.”
The survey found that about 80 percent of the firms are doing some exporting.
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