The manufacturing sector in the United States continued to show signs of recovery in August, accoding to Chad Moutray, Chif Economist at the National Association of Manufacturers. It notched the best reading since January 2019, bouncing back from springtime declines that were the worst since the Great Recession.
The headline index increased from 50.9 in July to 53.6 in August, led by strength across the board. New orders and output accelerated solidly, also at the best paces in 19 months. Hiring and exports both returned to positive growth in August. Manufacturers were also upbeat about continued increases in production, with the index for future output jumping to 63.9 in August, a reading not seen since April 2019.
Manufacturers continued to expand, building on the rebounds seen since the spring months. However, signs of decelerating growth also emerged in some markets in August.
The IHS Markit Flash U.S. Manufacturing PMI continued to show signs of recovery in August. It notched the best reading since January 2019, with the headline index rising from 50.9 in July to 53.6 in August, led by strength across the board.
Regional surveys from the New York and Philadelphia Federal Reserve Banks each reported slower expansions in activity in August. However, respondents remained upbeat about the next six months.
The IHS Markit Flash Eurozone Manufacturing PMI expanded very modestly for the second straight month, easing slightly in August from July’s pace. Sales and production were up solidly in Germany and — outside the European Union — in the United Kingdom. However, manufacturing activity weakened in France.
Initial unemployment claims rose to 1,106,000 for the week ending August 15. Claims had been at 971,000 for the week ending August 8, falling below one million for the first time since mid-March. Meanwhile, continuing claims dropped from 15,480,000 for the week ending August 1 to 14,844,000 for the week ending August 8. As such, 10.2 percent of the workforce was receiving unemployment insurance in the latest data, down from 10.6 percent in the previous report.
Michigan created the most net new manufacturing jobs in July, adding 9,400 workers. Despite gains over the past three months, manufacturing employment figures continue to experience sizable declines due to COVID-19.
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