Not even the nasty January weather could keep Western New York’s manufacturers down.
After slumping in December, local manufacturers said business picked up again last month, even with the cold and snowy weather making things difficult on employees and suppliers.
The rebound during January was fueled by increased production at local factories, coupled with a growing flow of new orders that pushed the region’s manufacturers back into the growth mode for the 10th time in the last 11 months, according to a new report from the National Association of Purchasing Management – Buffalo.
“Things picked up a bit, overall, this past month,” said Jay K. Walker, the Niagara University economist who compiles the monthly report. “While not a spectacular increase, this may calm some fears of [December’s] decline.”
The group’s business activity index return to growth territory at 52.9 after having dropped to 48.4 during December, the first time since February that it had shown a decline in local manufacturing by falling below the tipping point of 50 that is the dividing line between a growing and contracting manufacturing sector.
“I’ll admit I was a bit concerned regarding this month’s results, with the weather issues ... and whether they would translate into a second month of declining activity,” Walker said.
After spiking during the early fall to the strongest growth rates since the Great Recession, business cooled but continued to expand during November, only to turn modestly downward in December and then return to slow growth last month.
Production, which slumped badly during December, picked up steam again during January, with a quarter of the local factories surveyed reporting increases in output, double the level from December.
The flow of new orders continued to improve, the pace of that growth was the slowest in seven months as just a quarter of the managers surveyed said their firms booked more business last month, down from 38 percent in December.
Hiring remained weak for the fourth straight month, although manufacturers shed jobs at a slightly slower pace last month than they did during December. While one in four firms said they were cutting jobs during both December and January, the number of firms that were hiring rose from none in December to one in eight last month.
Inventories shrunk for the second straight month, while commodity prices rose at their fastest pace in four months, the survey found.