Gardner Business Index: April 2017 — 51.4
Finishing industry expands for the fourth consecutive month.
With a reading of 51.4, the Gardner Business Index showed that the finishing industry expanded for the fourth month in a row. The rate of growth slowed noticeably in April, however the first four months of 2017 are the first growth in the industry since the beginning of 2015.
New orders grew for the fourth straight month, but the rate of growth in April was easily the slowest in 2017. The same could be said of production, but its rate of growth has decelerated the last two months. The backlog index contracted for the second month in a row, still, the overall trend indicated capacity utilization should increase in 2017. The employment index grew for the sixth month in a row. While the rate of growth slowed, the upward trend in the employment index remains in effect. Exports continued to contract, and supplier deliveries lengthened 14 out of the last 15 months at a generally accelerating rate.
Since late 2015, the material prices index has increased significantly, increasing at its third fastest rate since the survey began in December 2011. The rate of increase was only slightly less than last month. Prices received increased for the fifth month in a row at a relatively constant rate. Future business expectations were still strong, but the index has dropped considerably since December 2016.
Industrial motors/hydraulics/mechanical components, primary metals and hardware all demonstrated an index above 60.0. Electronics/computers/telecommunication experienced solid growth for the third straight month. The aerospace industry grew for the seventh time in eight months. The forming/fabricating industry grew for the fifth month, but the rate of growth slowed noticeably in April. Automotive was flat after four months of growth.
Only the North Central-West and North Central-East grew in April. The North Central-West was the fastest growing region. Both regions grew for the fourth consecutive month. The South Central, Southeast, and West had moderate contraction and the Northeast contracted somewhat faster.
Plants with more than 250 employees expanded for the sixth time in seven months with an index above 60.0 in the last two months. Facilities with 100-249 employees grew at a strong rate for the fifth month in a row and those with 50-99 employees contracted for the first time since November 2016. Finishers with 20-49 employees grew for the fourth month and those with fewer than 20 employees contracted for the first time this year.
Originally published in the June 2017 issue.
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