Finishing Industry Sets New Record

The Finishing Index hit 55.9 in October, narrowly beating the previous high it reached in February.

Registering 55.9 for October, the Gardner Business Index: Finishing narrowly beat the prior record reading of 55.7 it posted in February 2017. Prior to then, index readings had not exceeded 55 since 2014. This latest reading raised the average for the year-to-date period to 54.3 and compared favorably to the revised average third-quarter reading of 53.1. The index is up approximately 13.4 percent and 18 percent for the year-to-date and 12-month periods, respectively. Gardner Intelligence’s review of the underlying data for the month of October indicates that supplier deliveries, new orders and production lifted the business index higher, while employment, backlogs and exports pulled the index lower. Although backlog readings are still in contractionary territory, we believe the increasing growth 
in new orders and production is likely to send backlogs higher in the near future.  

We have seen significant volatility in new orders and production readings in 2017. New orders have registered three readings above 61.0 this year, indicating strong growth, and three readings at or below 53.0, signaling only modest growth. Similarly, first-quarter data showed strong production growth and then relatively weak growth in the third-quarter, followed by a rebound in October.