Manufacturing growth slows in March

April 3, 2013
Though still growing, business activity in the U.S. manufacturing sector slowed last month as the overall economy continues its unsteady climb out of the 2008-2009 Recession

The Institute for Supply Management released its monthly Manufacturing Report on Business this week, showing continued growth in the sector, though at a slower rate compared to February.

ISM’s Purchasing Manager’s Index registered 51.3 for the month, a 2.9 percentage point decline from February, but still above the 50-point mark indicating expansion in the sector. ISM also reported growth in new orders, production and employment in March, with new orders and production growing at a slower rate while employment grew faster during the month.

Purchasing managers surveyed for the monthly report gave mixed reviews on the sector’s outlook, with computer and electronics representatives pointing to a more promising second half of the year. That outlook echoes comments from electronics distribution executives interviewed for Global Purchasing/SourceESB’s upcoming Top 50 Electronics Distributors report, to be published in May.

Future Electronics’ executive vice president Lindsley Ruth points to an up year compared to 2012, for example.

“At Future, we’re very optimistic about this year. Last year was a year of investment, and we’re beginning to reap the benefits of that investment,” Ruth explains. “We’re seeing an uptick in demand, so we’re gaining confidence as we go. We’re looking at a year in the supply chain that will be up in the high single digits to low double-digits.”

TTI’s senior vice president for the Americas Michael Knight agrees that 2013 is likely to turn out well, but says he’s cautious about the longer term outlook.

“We may have an up year as an industry … but the actual underlying demand I suspect is going to be a lot softer than we experience,” he says. “That calls into question what 2014 will look like; 2014 has got me a little nervous, but this year I think we’re going to be okay.”

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