Manufacturing – Right Report https://right.report There's a thin line between ringing alarm bells and fearmongering. Fri, 25 Oct 2024 08:53:44 +0000 en-US hourly 1 https://wordpress.org/?v=6.6.2 https://right.report/wp-content/uploads/2024/10/cropped-Favicon-32x32.png Manufacturing – Right Report https://right.report 32 32 237554330 US Manufacturing Slump Continues Amid Economic Uncertainty https://right.report/us-manufacturing-slump-continues-amid-economic-uncertainty/ https://right.report/us-manufacturing-slump-continues-amid-economic-uncertainty/#respond Fri, 25 Oct 2024 08:53:44 +0000 https://right.report/us-manufacturing-slump-continues-amid-economic-uncertainty/ (The Epoch Times)—A new report from the Federal Reserve shows that U.S. manufacturing activity continued to decline in September, while a forward-looking indicator from the Conference Board signaled uncertainty for economic activity ahead, due in part to a sharp drop in factory new orders.

The Fed’s Beige Book, released on Oct. 18, revealed a broad contraction in manufacturing across the United States, reflecting weaker demand and sluggish production.

Most of the Fed’s 12 districts reported declining manufacturing activity, exacerbated by difficulties in finding qualified workers and, in some cases, persistently weak sales.

The Fed’s data on the manufacturing slump was echoed by the Conference Board’s Leading Economic Index (LEI) report, released on Oct. 21, which recorded a 0.5 percent drop in September—an acceleration from August’s 0.3 percent decline. A significant factor in September’s decline was a sharp decrease in new factory orders, contributing to a 2.6 percent decrease in the index over the past six months.

The LEI, which is designed to forecast economic turning points, points to weak economic growth heading into 2025.

“Weakness in factory new orders continued to be a major drag on the US LEI in September as the global manufacturing slump persists,” Justyna Zabinska-La Monica, a senior manager at the Conference Board, said in a statement. “Overall, the LEI continued to signal uncertainty for economic activity ahead and is consistent with The Conference Board expectation for moderate growth at the close of 2024 and into early 2025.”

The persistent downturn in U.S. manufacturing has become a focal point in the 2024 presidential race.

Meanwhile, economic sentiment has taken a downward turn recently.

Even though inflation has eased since the June 2022 recent peak of 9 percent, the Fed’s Beige Book indicates that many districts reported increasing price sensitivity among inflation-weary consumers. Input costs rose faster than selling prices in September, compressing profit margins and further pressuring U.S. businesses, including manufacturers.

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Manufacturing Weakness Deepens With Bigger-Than-Expected Decline in Industrial Output https://right.report/manufacturing-weakness-deepens-with-bigger-than-expected-decline-in-industrial-output/ https://right.report/manufacturing-weakness-deepens-with-bigger-than-expected-decline-in-industrial-output/#respond Sat, 19 Oct 2024 23:13:19 +0000 https://right.report/manufacturing-weakness-deepens-with-bigger-than-expected-decline-in-industrial-output/ (The Epoch Times)—U.S. industrial production fell more sharply than expected in September, signaling continuing weakness in the nation’s factory activity.

Data from the Federal Reserve, released on Oct. 17, showed a 0.3 percent decline in industrial output, following a downwardly revised 0.3 percent gain in August. Analysts had predicted a smaller drop of 0.2 percent for the month.

According to the Fed, the larger-than-expected decline was due in part to disruptions from Hurricanes Helene and Milton, along with the ongoing Boeing machinists’ strike. The aerospace sector, in particular, took a significant hit, with production of aerospace and miscellaneous transportation equipment falling by 8.3 percent, dragging down the overall index.

The broader picture also looks bleak, with industrial output for the third quarter down 0.6 percent. This aligns with other recent indicators pointing to ongoing challenges in the U.S. manufacturing sector.

The latest S&P Global U.S. Manufacturing PMI, a key survey-based measure, showed the sharpest contraction in factory activity in over a year for September. Factory output and new orders dropped sharply, driven by weakened demand.

“The September PMI survey brings a whole slew of disappointing economic indicators regarding the health of the U.S. economy,” Chris Williamson, chief business economist at S&P Global Market Intelligence, said in a statement. “Factories reported the largest monthly drop in production in 15 months in response to a slump in new orders, in turn driving further reductions in employment and input buying as producers scaled back operating capacity.”

The deepening decline in U.S. manufacturing, highlighted by the S&P Global report, was reinforced by the Fed’s latest industrial production data. It showed a 0.4 percent month-over-month fall in manufacturing output for September and a 0.5 percent drop compared with the previous year.

Similarly, the Institute for Supply Management (ISM) reported a contraction in U.S. manufacturing for September, marking the sixth straight monthly decline and the 22nd contraction in the past 23 months. Timothy Fiore, chair of the ISM’s Manufacturing Business Committee, noted that demand remains sluggish, with companies hesitant to invest in capital and inventory.

The ongoing slump in U.S. manufacturing has become a key issue on the presidential campaign trail, with both major candidates offering plans to revive the sector.

Speaking in Michigan in late September, former President Donald Trump vowed to “reclaim America’s manufacturing power,” promising tariffs on foreign imports and pledging to provide domestic manufacturers with lower energy costs, taxes, and regulatory burdens.

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