Finally Some Good News on Manufacturing

Manufacturing has been struggling in the U.S. since mid-2015.
A high dollar raising prices for U.S. exports and overall weak global demand have kept manufacturing output low.
Indeed, the Institute of Supply Management’s Manufacturing Index has been below the growth point of +50 since October 2015.
The just-released June numbers reverse that, with a manufacturing index at a 16-month high of 53.2, up from last month’s figure of 51.3.
Production, new orders, and employment were all positive in the June report, as were reports from 13 out of 18 manufacturing sub-sectors.
All this is good news, but we’re still not out of the woods.

Automobiles—which had been growing at a stellar pace—declined in June, compared to May.
Also, growth needs to continue in order to recover the 53,000 U.S. manufacturing jobs lost since the beginning of the year.
Connecticut manufacturers have added 1,800 over the 12 months through May this year, gaining 1,200 new positions in May alone.
Finally, Brexit lays a shroud of uncertainty on future growth. Many companies see that as a net negative.
All of this means it’s important for our state to do all that it can to help our manufacturers compete on the global stage.

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Pete Gioia is an economist with CBIA. Follow him on Twitter @CTEconomist.