MBI Shows Consistent Growth for Industry

Sub-Indices	April	March	Percentage Point Change	Direction	Rate of Change	Trend (Months)
New Orders	56.4	63.4	-7.0	Growing	Slower	20
Production	59.0	63.0	-4.0	Growing	Slower	9
Employment	57.2	55.1	2.1	Growing	Faster	12
Backlog	48.9	55.0	-6.1	Contracting	From Growing	1
Exports	49.7	46.8	2.9	Contracting	Less	2
Supplier Deliveries	58.1	59.2	-1.2	Lengthening	Less	8
Material Prices	62.7	67.4	-4.7	Increasing	Less	29
Prices Received	54.1	55.8	-1.7	Increasing	Less	17
Future Business Expectations	72.7	75.9	-3.3	Improving	Less	35

Overall MBI	54.9	57.0	-2.1	Growing	Slower	33

With a reading of 54.9, the April MBI showed that the metalworking industry had grown at a fairly consistent rate since October 2011. In fact, April marked the 33rd month of growth, even though it was the first month of noticeably slower growth since October 2011.

Four of the six subindices lowered the industry’s growth rate. Most notably, new orders moved from 63.4 to 56.4 and production moved from 63.0 to 59.0. While the new order growth rate slipped below the average rate for this expansion, the production growth rate remained fairly strong. Because production grew faster than new orders, backlogs moved from strong growth to contraction in April. Supplier deliveries also contributed to the slower industry growth rate, but the change was not that great. Supplier deliveries still indicated widespread strength in the manufacturing supply chain.

Employment and exports were on the other end of the spectrum. Employment had grown for 12 consecutive months, but it did so at a faster rate in April. Exports still contracted, but they did so at a slower rate in April. This helped keep the industry’s growth rate up.

Future business expectations fell to their lowest level since November 2011. However, expectations were still notably above the level seen in the first half of 2011. While expectations came down a little, metalworking facilities continued to buy equipment at a significant rate. Average spending per plant trended up and reached its second highest level since June 2011.