Report: Manufacturing sector shows signs of strain

Industrial Distribution staff -- Industrial Distribution, 4/17/2008 8:46:00 AM

The economic slowdown is causing the United States manufacturing sector to show signs of strain, according to a report from the Manufacturers Alliance/MAPI.

The group’s quarterly Survey on the Business Outlook’s composite index fell to 57 from December’s reading of 64—the lowest since December 2006’s reading of 54.

A reading above 50 indicates expansion in the manufacturing sector; a reading below 50 indicates contraction. The index is a composite of 10 factors measured in a quarterly survey of 68 senior financial manufacturing company executives.

"Despite the fact that all the indexes remain above the 50 percent threshold separating growth from contraction, the fact that they all fell indicates that the growth of U.S. manufacturing activity is slowing," MAPI economist Donald Norman said. "At the same time, most of the companies represented in the survey are global, and the outlook for business abroad is somewhat rosier. Global growth will help offset any slowing of activity in the United States. Companies with global operations should be in a better position to withstand a U.S. slowdown."

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