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Slump in orders slows growth at local factories, survey finds

The good times continue for Buffalo Niagara manufacturers.

A new report, based on a survey of local purchasing managers, indicated that business at the region’s factories kept growing at a solid pace during April, extending a pattern of expansion that has been in place throughout 2018.

But there was a warning sign in the latest report from the Institute of Supply Management – Buffalo. The flow of new orders weakened during April, which could squeeze production and jobs in the coming months if the softness continues.

"The numbers continue to signal strong growth in April but at a slower rate than in February and March," said Randall Cragun, the Niagara University economist who compiles the monthly report on local manufacturing activity.

The group’s business activity index fell to a four-month low of 63.7 during April, down from 76.8 in March, but it remained at a level that indicates solid growth at local factories. The index, which can swing wildly from month to month, had reached a 20-year high in October, only to see the pace of growth slow during each of the following two months before rebounding in January.

An index above 50 indicates growth at local factories, while a reading below that is a sign of weakness. The local index has been above 50, indicating factory growth, every month since August 2016.

Much of the slowdown in growth was due to the drop in new orders, which declined for the first time since December. But production and hiring both grew at a faster pace during April, as did commodity prices and inventories.

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