Gardner Business Index: Metalworking Experiences Broad August Rebound

Five of six business indicators show significant growth.

Registering 58.1 for August, the Gardner Business Index (GBI): Metalworking recorded accelerating growth for the first time after reaching an all-time high in February. The Metalworking Index grew by 6 percent from the same month one year ago. Additionally, August’s reading brought the index above its 2017 average—the best average annual reading in recorded history—of 55.8. Supplier deliveries drove the index followed by production, new orders and employment. While the readings for backlog and exports lowered the index’s average, none of the components contracted (registered below 50.0) during the month.

The broad-based resumption of accelerating growth by index drivers tends to indicate that significant economic factors are driving the economy toward greater growth as opposed to a one-off event that may drive a single index component momentarily higher.

Since February 2016, backlog readings have registered 17 consecutive months of growth, the longest duration of continuing backlog growth. This long-running growth in backlogs suggests that manufacturing production levels still have room to grow in 2018 and 2019.