Dock slowdown has impact on sliding PMI

Despite settlement, the monthly PMI index drops to 12-month low at 52.9%.

03/02/2015


The announced settlement of the West Coast dock workers slowdown came a little too late to boost the Institute for Supply Management's (ISM) monthly PMI Index in February.

The dock slowdown on the West Coast got most of the blame as the PMI fell from 53.5% in January to 52.9% in February. The February PMI was the index's lowest level in more than a year and marked the fourth straight month of decline, but it still was solidly above the growth line of 50%, where it has been for the past 26 months.

"Comments from the panel express a growing level of concern over the West Coast dock slowdown, negatively impacting exports and imports and requiring workarounds and added costs," said Bradley J. Holcomb, chairman of the Institute for Supply Management's Manufacturing Business Survey Committee, which produces the monthly index.

The dock slowdown on the West Coast got most of the blame as the PMI Index fell from 53.5% in January to 52.9% in February. Courtesy: Institute for Supply ManagementA deal between dock workers and interests for shipping companies and terminal operators was announced on February 21. The deal ends a nine-month slowdown at West Coast ports. While normal dock work now will resume, a massive backlog of goods still sits on inbound and outbound ships.

Committee members were especially aware of the impact of the slowdown in their monthly comments. Committee members in the food and beverage, transportation equipment, computers and electronics and machinery sectors all cited the dock slowdown as a significant factor.

"West Coast port congestion and work slowdowns by the union is hurting our imports and exports, (and) getting worse by the week," said one manufacturer.

That issue aside, however, the general tone for manufacturing was again solid. "One manufacturer said the sector is "improving, and 2015 is off to a good start."

The February PMI corresponds to an annual 3.1% increase in gross domestic product. The index continues to average more than 10% higher than its break-even point, at 55.7% over the past 12 months.



No comments
The Top Plant program honors outstanding manufacturing facilities in North America. View the 2015 Top Plant.
The Product of the Year program recognizes products newly released in the manufacturing industries.
The Engineering Leaders Under 40 program identifies and gives recognition to young engineers who...
2016 Product of the Year; Diagnose bearing failures; Asset performance management; Testing dust collector performance measures
Safety for 18 years, warehouse maintenance tips, Ethernet and the IIoT, GAMS 2016 recap
2016 Engineering Leaders Under 40; Future vision: Where is manufacturing headed?; Electrical distribution, redefined
SCADA at the junction, Managing risk through maintenance, Moving at the speed of data
Safety at every angle, Big Data's impact on operations, bridging the skills gap
The digital oilfield: Utilizing Big Data can yield big savings; Virtualization a real solution; Tracking SIS performance
Applying network redundancy; Overcoming loop tuning challenges; PID control and networks
Driving motor efficiency; Preventing arc flash in mission critical facilities; Integrating alternative power and existing electrical systems
Package boilers; Natural gas infrared heating; Thermal treasure; Standby generation; Natural gas supports green efforts

Annual Salary Survey

Before the calendar turned, 2016 already had the makings of a pivotal year for manufacturing, and for the world.

There were the big events for the year, including the United States as Partner Country at Hannover Messe in April and the 2016 International Manufacturing Technology Show in Chicago in September. There's also the matter of the U.S. presidential elections in November, which promise to shape policy in manufacturing for years to come.

But the year started with global economic turmoil, as a slowdown in Chinese manufacturing triggered a worldwide stock hiccup that sent values plummeting. The continued plunge in world oil prices has resulted in a slowdown in exploration and, by extension, the manufacture of exploration equipment.

Read more: 2015 Salary Survey

Maintenance and reliability tips and best practices from the maintenance and reliability coaches at Allied Reliability Group.
The One Voice for Manufacturing blog reports on federal public policy issues impacting the manufacturing sector. One Voice is a joint effort by the National Tooling and Machining...
The Society for Maintenance and Reliability Professionals an organization devoted...
Join this ongoing discussion of machine guarding topics, including solutions assessments, regulatory compliance, gap analysis...
IMS Research, recently acquired by IHS Inc., is a leading independent supplier of market research and consultancy to the global electronics industry.
Maintenance is not optional in manufacturing. It’s a profit center, driving productivity and uptime while reducing overall repair costs.
The Lachance on CMMS blog is about current maintenance topics. Blogger Paul Lachance is president and chief technology officer for Smartware Group.
This article collection contains several articles on the vital role of plant safety and offers advice on best practices.
This article collection contains several articles on the Industrial Internet of Things (IIoT) and how it is transforming manufacturing.
This article collection contains several articles on strategic maintenance and understanding all the parts of your plant.
click me