Gardner Business Index: Precision Machining December 2022

According to Gardner Business Intelligence, the Gardner Business Index (GBI): Precision Machining contracted at a steady rate in December, closing at 47.5 compared to November’s 47.9. (See last month’s reading.)

GBI: Precision Machining component activity in December is essentially a continuation of November.

• Backlog is the demand component that contracted more and faster in December. The good news is existing orders are being delivered; the concerning news is it does not appear that existing orders are being backfilled by new orders.
• In fact, new orders activity contracted a bit faster in December as well, to a level not seen since July 2020.
• Production contracted for the third straight month in December, at a rate slower than backlog and new orders, reflecting the relationship between the three components that have production lag.
• Exports contracted again in December.
• Employment activity continued to expand in December, but the Q4 trend suggests it may be at risk of contracting come January/February.
• Supplier deliveries continued to lengthen at a slower rate on its way to a more ‘typical’ state.

Precision Machining Business Index

Precision Machining activity continued to contract in December, closing the month at 47.5.

Key Components (3-month moving average)

Demand indicators, new orders and backlog continued to contract faster and to greater degrees in December compared to exports activity which has consistently contracted the longest, since September 2021.