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Despite crippling snowstorm, production picked up last month

The Buffalo Niagara region’s manufacturers showed their resilience last month, even with the snowstorm that crippled parts of the Southtowns for the better part of a week.

In fact, a new survey of local purchasing managers found that business actually picked up last month at the region’s factories, fueled by an uptick in both production and the flow of new orders.

“I was concerned as to what the survey results would show,” said Jay K. Walker, the Niagara University economist who compiles the monthly report for the Institute of Supply Management – Buffalo.

“But again this month, most indices indicate favorable results,” he said. “It was another consistent month with what’s been going on in 2014. Production was strong relative to the prior month and the overall local index bumped up some.”

The group’s business activity index jumped to 62 in November from 55.5the previous momth, hitting its highest level since June and remained well above the tipping point of 50 – the dividing line between a growing and contracting manufacturing sector – for the 18th time in the last 20 months.

The pickup in growth during November extended the growth streak among Buffalo Niagara manufacturers to nine months and was the first time since August that the pace of the expansion at local factories was faster than it had been during the previous month, according to the survey of local purchasing managers.

Driving the index higher was a spike in both new orders and production, with nearly three of every five managers surveyed saying output and orders increased at their firms, up from two in five during October. The pace of production growth was the strongest since May, while order flow improved to its fastest pace since June.

Factories also resumed hiring after cutting back during October. A little more than a quarter of the firms surveyed added workers last month, up from just 10 percent during October.

“I’ll be watching to see how local participants respond to their December surveys,” Walker said. “Some facilities, especially in the Southtowns, had to run extra shifts to catch up from the delays and shutdowns that resulted from the storm.”

The survey also found some rare good news on commodity prices, with the drop in oil prices helping keep commodity prices stable during November – the first time that’s happened since last November, the survey found.

Inventories also grew at their slowest pace in four months during November, the survey found.