MAPI Index slips slightly
The latest Manufacturers Alliance for Productivity and Innovation (MAPI) Survey on the Business Outlook fell to 55 from 56 in the September 2012 survey.
The results indicate that the sector continues to grow, but at a nominal pace as it confronts ongoing challenges.
The survey’s composite index is a leading indicator for the manufacturing sector. Despite the decline—its 10th straight since reaching a record high of 81 in June 2010—the index remains above the threshold of 50, the dividing line that separates contraction and expansion. The drop of only 1 percentage point may portend some stabilization, and is below the fairly significant 5 percentage point drop in the September survey, the largest over the 10-quarter decline.
“Movements in the individual indexes were mixed, but most of the forward looking indexes showed some, if marginal, improvement,” said Donald A. Norman, Ph.D., MAPI senior economist and survey coordinator. “The rapid slowdown in the growth of manufacturing production that began in March 2012 appears to have bottomed out and the outlook is for slow expansion over the next three to six months.”
The Composite Business Outlook Index is a weighted sum of the Prospective U.S. Shipments, Backlog Orders, Inventory, and Profit Margin Indexes. In addition to the composite index, which reflects the views of 55 senior financial executives representing a broad range of manufacturing industries, the survey includes 13 individual indexes that are split between current business conditions and forward looking prospects.
Overall, 6 of those 13 indexes decreased, including 4 of the 6 current business condition indexes, and 1 remained flat.
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