GBI for January: 54.4

With a reading of 54.4, the Gardner Business Index shows that durable goods manufacturing grew at an accelerating rate for the third month in a row. This month durable goods manufacturing grew at its fastest rate since May 2014 and third fastest rate since April 2012.

The new orders index increased for third month in a row, growing at its fastest rate since March 2014. Production jumped dramatically, expanding sixth straight month and growing at its fastest rate since March 2014. The backlog index increased for the first time since April 2014. The trend in the backlog index clearly indicated capacity utilization should increase in 2017. Employment increased at an accelerating rate for the fourth month. Exports is the one area that continued to struggle, contracting at a faster rate in January. Supplier deliveries lengthened for the 12^th month in a row.

Material prices increased at a significantly faster rate for the second consecutive month. The index reached its highest level since February 2013. Prices received increased at an accelerating rate for the second month in a row. The rate of increase was the fastest since January 2014. After a huge spike due to November’s election results, the future business expectations index crept higher each of the last two months, setting a record high for the third month in a row.

Plants with more than 250 employees grew at an accelerating rate for the fourth month. Facilities with 100-249 employees grew for the fourth time in five months. Companies with 50-99 expanded for the fifth time in six months, growing at their fastest rate since January 2012. Companies with 20-49 employees grew for the fourth straight month, growing at their fastest rate since the survey began in December 2011. Companies with fewer than 20 employees expanded for the first time since June 2015.

The North Central-East was the fastest growing region in January. It grew at its fastest rate since March 2012. It was closely followed by the Southeast, Northeast, and North Central-West. The South Central had moderate growth but grew for the second month in a row. The West marginally grew for the third time in five months.

The fastest growing industries were furniture, primary metals, petrochemical processors, HVAC, forming/fabricating, automotive, custom processors, plastic/rubber products, machinery/equipment, electronics/computers/telecommunications, military, aerospace, metalcutting job shops, other, hardware, oil/gas-field/mining machinery, pumps/valves/plumbing products, and industrial motors/hydraulics/mechanical components. Only medical, off-road/construction machinery, and power generation did not grow in January.

In addition to the overall durable goods index, we compute indices for a number of technologies or processes. For the third month in a row, precision machining grew at the fastest rate. Finishing grew for the first time since June 2015. Plastics grew at its fastest rate since January 2015. Moldmaking grew for the fifth time in six months. Composites grew for the second month in a row. Metalworking grew for the first time since June 2015.