Buffalo Niagara manufacturers said business remained brisk during March.
With new orders flowing in at a robust pace and the plunge in oil prices giving manufacturers some relief on commodity prices, local manufacturers said business grew at a slightly faster pace in March, according to a new survey of purchasing managers in the Buffalo Niagara region.
While growth rates can vary widely from month to month, March’s expansion was the second-strongest in almost eight years, dating back to before the recession, and was second only to the full-throttle expansion indicated by the January survey, which pegged the pace of the increase at its fastest rate in more than a decade.
The latest survey showed that local manufacturers continue to report stronger growth than their counterparts across the country in a nationwide poll by the Institute of Supply Management, which has seen slower growth for five straight months and now is showing that the expansion in the factory sector has almost stalled.
The improvement during March stretched the growth streak for local manufacturers to 13 months. The local index has been higher than the national benchmark every month since November.
“It seems like on a national scale there’s a bit more uncertainty with general economic activity but local manufacturing activity doesn’t seem to have been harmed,” said Jay K. Walker, the Niagara University economist who compiles the monthly report for the Institute of Supply Management – Buffalo.
The group’s business activity index strengthened to 67.4 last month from 64.5 in February, but still lower than the 73.7 it hit in January, its highest since July 2004. An index reading of more than 50 indicates growth, while an index of less than 50 is a sign of decline.
Driving the index higher last month was a strong flow of new orders to local manufacturers, which finished March at the second-highest level in the last 16 years, second only to the high it hit in January. The growth also was fairly widespread, with seven of every eight manufacturers surveyed reporting that their companies booked more business during March than they did during February.
The continued drop in oil prices also is giving local manufacturers a break in their commodity prices, which fell for the first time in 18 months. “The impact of lower oil prices may have finally appeared,” Walker said.
The pace of production remained robust, although it slowed for the second straight month from January’s peak, with five of every eight manufacturers surveyed reporting that their companies increased their output last month.
Local factories also picked up the pace of their hiring last month, although it remained below January’s 17-year high, with half of the firms adding workers last month, up from a third during February.
“I’m still personally impressed with the rebound we’ve seen to start the year, following the fourth quarter of 2014 being relatively weak in terms of employment,” Walker said.