Georgia’s PMI of 48.5 dropped one point for August, falling 7.2 points below the National PMI of 55.7, which experienced a slight increase of 0.3 points for August. This is the second consecutive month that Georgia’s PMI has rested below 50, and 4.9 points below its six-month average of 53.4, according to Don Sabbarese, director of the Econometric Center and professor of economics at Kennesaw State.
“Georgia’s new orders rebounded for August, but production and employment weaknesses are a concern, given their drop of 11.3 and 7.1 points, respectively, below their June readings,” said Sabbarese.
While nationally the index appears to show a more positive picture, according to Sabbarese, there are signs of weakness in the national picture similar to what Georgia is experiencing.
“The July Industrial Production report for national manufacturing showed a strong decrease in automobile production, which was the primary cause of a 0.1 percent drop, which computes to an annualized decrease of 1.1 percent,” he said. “The high-tech sector was the only sector nationally to record solid growth in July.”
This observation is drawn from a survey question that asked respondents about their anticipated production for the next three to six months. The percent of manufacturers expecting an increase has dropped for the last four months, he added.
Other highlights from the August PMI:
· New orders up 7.0 points to 52.5, 5.0 points below its six-month average;
· Production down 0.5 of a point to 45, 7.7 points below its six-month average;
· Employment down 5.0 points to 45, 7.4 points below its six-month average;
· Supplier delivery down 11.6 points to 47.5, 4.0 points; below its six-month average
· Finished inventory up 4.8 points to 52.5, 0.5 of a point below its six-month average; and
· Commodity prices up 12.5 points to 62.5, 11.3 points above its six-month average.