December Reading Closes Out an Excellent 2017
December closes above 2017’s record-breaking average reading level.
Registering 56.6 for December, the Gardner Business Index (GBI): Precision Machining closed out the year on a positive note as the index moved higher from the prior month. For 2017, the Precision Machining Index averaged a monthly reading of 55.6, besting all prior calendar year averages, including the prior record from 2014 of 54.2. Compared with the same month one year ago, the index increased by 5.3 percent. Gardner Intelligence’s review of the underlying data indicates that new orders, supplier deliveries and production lifted the business index higher, while employment, backlog, and exports pulled the index lower. For the month, no components contracted.
December experienced strong expansion in new orders, recording its second highest reading of the year and in the history of the index. Production also grew, but not as quickly, however, in Gardner Intelligence’s review of past trends, when new orders growth exceeds production growth, it is typical for the industry to experience additional growth in future months as manufacturers adjust to the increased demand. Such instances also tend to result in increased backlogs and/or exports readings, both of which expanded in December.