New orders surge during November

The Commerce Department reported a 2.5% rise in new orders for manufactured goods between October and November, after a negligible 0.1% increase the month before. Orders have now risen for six consecutive months.


The Commerce Department reported a 2.5% rise in new orders for manufactured goods between October and November, after a negligible 0.1% increase the month before. Orders have now risen for six consecutive months. Although most economy-watchers expected some continued orders growth during the latest month, the magnitude of the increase caught just about everyone by surprise.

Trends in the NAPM orders index in particular have suggested that we would see some slowdown in this measure's growth rate. Below the surface, the number fell more in line with expectations. Excluding the transportation industry sector, new orders for manufactured goods actually decreased 0.3% during November. Transportation equipment orders shot up 21%, with most of the gain coming in the aircraft group.

Shipments of manufactured goods didn't perform as well as orders in November. Total shipments fell 0.3% to $333.1 billion. However, shipments for aircraft sparked up by 13.6%, a major factor in November's 1.2% gain in overall transportation shipments. Excluding aircraft, transportation shipments fell by 2.5%. With inventories running lean, the modest 2.3% increase in unfilled orders should keep manufacturers busy in upcoming months.

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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

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