09202019Fri
Last updateThu, 19 Sep 2019 4pm

U.S. Manufacturing Contracts for First Time Since 2009

The seasonally adjusted IHS Markit Flash U.S. Manufacturing Purchasing Managers’ Index (PMI) registered 49.9 in August, down from 50.4 in July and below the neutral 50.0 threshold for the first time since September 2009.

The decline in the headline PMI mainly reflected a much weaker contribution from new orders, which offset a stabilization in employment and fractionally faster output growth.


U.S. Leading Economic Indicators Up in July

The Conference Board Leading Economic Index (LEI) for the U.S. increased 0.5% in July to 112.2, following a 0.1% decline in June, and a 0.1% decline in May.

“However, the manufacturing sector continues exhibiting signs of weakness and the yield spread was negative for a second consecutive month. While the LEI suggests the U.S. economy will continue to expand in the second half of 2019, it is likely to do so at a moderate pace,” said Ataman Ozyildirim, senior director of economic research at The Conference Board.

Emerson Survey Shows Interest in STEM Careers, Lack of Encouragement

As the world faces a skilled workforce gap, the fifth annual STEM survey by Emerson found that 6 out of 10 Americans are interested in pursuing STEM careers – but fewer than 4 in 10 (39%) have felt encouraged to do so. The disparity is even more pronounced among women: 2 out of 3 U.S. women say they were not encouraged to pursue a career in STEM.

While the survey found that younger generations across the globe are three times more likely to be encouraged to pursue STEM careers than generations before them, there are still several critical gaps to address – particularly as industries continue to report that they cannot find individuals with the skills required for today’s advanced workplaces. For example, the National Association of Manufacturers found that more than 70% of manufacturers are concerned about finding workers with appropriate skills.

Manufacturing Productivity Down 1.6% in Second Quarter

Manufacturing sector labor productivity decreased 1.6% in the second quarter of 2019, the U.S. Department of Labor reports, as output decreased 2.1% and hours worked declined 0.5%. Productivity declined 0.9% in the durable manufacturing sector, reflecting a 1.8% decrease in output and a 0.9% decrease in hours worked. Productivity decreased 2.6% in the nondurable manufacturing sector as output fell 2.4% and hours worked rose 0.3%. Over the last four quarters, total manufacturing sector productivity increased 0.2%, as output increased 0.4% and hours worked increased 0.2%. Unit labor costs in the manufacturing sector increased 5.8% in the second quarter of 2019 and increased 4.3% from the same quarter a year ago.

Industrial Production Dropped in July

U.S. industrial production declined 0.2% in July. Manufacturing output decreased 0.4% last month and has fallen more than 1.5% since December 2018. Durables, nondurables and other manufacturing all posted decreases in July. Production fell for most major durable goods categories. The largest declines were recorded by wood products, machinery and nonmetallic mineral products, while the only sizable gain was registered by aerospace and miscellaneous transportation equipment.

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