Electrical Marketing's Key Economic Indicators

ABI gains three points in October

After a sharp dip in September, the Architecture Billings Index (ABI) climbed nearly three points in October. The American Institute of Architects (AIA), Washington, D.C. reported the October ABI score was 49.4, following a score of 46.9 in September. This score reflects an overall decrease in demand for design services (any score above 50 indicates an increase in billings). The new projects inquiry index was 57.3, up from a reading of 54.3 the previous month.

“An increase in the billings index is always an encouraging sign,” said, Kermit Baker, AIA chief economist. “But there continues to be a high level of volatility in the marketplace with architecture firms reporting a wide range of conditions from improving to uncertain to poor.”

PMI decreases in October

While still in growth territory at 50.8 percent, The Purchasing Managers Index (PMI) published monthly by the Tempe, Ariz.-based Institute for Supply Management (ISM) decreased 0.8 percentage point from September's reading of 51.6%.

“Comments from respondents are mixed, indicating positive relief from raw materials pricing and continuing strength in a few industries, but there is also more concern and caution about growth in this uncertain economy,” said Bradley Holcomb, chair of ISM's Manufacturing Business Survey Committee.

Machine-tool orders up big-time in September

Manufacturers invested in machine-tool orders at a near-record pace in September, according to the United States Manufacturing Technology Orders (USMTO) report published monthly by American Machine Tool Distributors' Association and the Association For Manufacturing Technology (AMT). September U.S. manufacturing technology orders totaled $606.6 million, up 22.9% from August and up 51.9% when compared with the total of $399.32 million reported for Sept. 2010. With a year-to-date total of $4.07 billion, 2011 is up 91.9% compared with 2010. “September numbers were the second highest monthly dollar total in the last 15 years,” said Peter Borden, AMTDA president. “American manufacturers are still rushing to beat the end-of-year bonus depreciation deadline.”

The Marketplace: Key Figures

Month Latest Month Previous Month Month-over-month % change Year ago Year-over-year % change 2008 annual CONSTRUCTION New Construction Put in Place (Billions of dollars, SAAR)² Total SEP 787.21 786.02 0.2 797.26 -1.3 801.88 Offices SEP 22.91 23.09 -0.8 23.87 -4 24.29 Industrial SEP 36.52 36.67 -0.4 35.1 4.1 37.63 Housing Starts (Thousands of units, SAAR)² Total OCT 628 630 -0.3 539 16.5 585 Single-unit OCT 430 414 3.9 434 -0.9 471 Mobile Home Shipments³ (Thousands of units, SAAR) SEP 54 51 5.9 47 14.9 50 Employment, Construction Workers (Thousands)⁴ OCT 5,765 5,791 -0.4 5,748 0.3 5,526 Employment, Electrical Contractors (Thousands)⁴ SEP 748.4 753.2 -0.6 731.6 2.3 723.2 Hourly Wage, Electrical Contractors⁴ SEP 25.84 26.12 -1.1 25.28 2.2 25.26 PRODUCTION Industrial Production Index (1967=100)⁵ OCT 94.7 94.1 0.7 91.1 3.9 90.1 Construction Supplies Production Index⁵ (1977=100-SA) OCT 77.2 77.2 0.1 74.3 4 72.7 Employment in Electrical Equipment & Supplies Mfg. Production workers (Thousands)⁴ SEP 140.6 140.7 -0.1 137.5 2.3 136.3 Weekly hours SEP 43.6 43.2 0.9 42.2 3.3 42.2 Hourly wage SEP 18.42 17.99 2.4 16.42 12.2 16.51 Electric Power Output Index (1967=100)⁵ OCT 98 97.6 0.4 97.8 0.2 100.6 Machine Tool Orders* (Millions of dollars)⁶ SEP 554.37 450.48 23.1 363.74 52.4 Industrial Capacity Utilization (Percent, SA)¹ OCT 75.95 75.64 0.3 73.3 2.7 71.86 TRADE Electrical Mfrs' Shipments SEP 3,857 3,947 -2.3 3,617 6.6 Electrical Mfrs' Inventories (Millions of dollars, SA)² SEP 4,775 4,946 -3.5 4,942 -3.4 4,713 Electrical Mfrs' Inventory-to-Shipments Ratio SEP 1.238 1.253 -1.2 1.366 -9.4 1.364 Electrical Mfrs' New Orders (Millions of dollars, SA)² SEP 3,870 3,895 -0.6 3,691 4.8 Electrical Mfrs' Unfilled Orders (Millions of dollars, SA)² SEP 14,634 14,621 0.1 12,479 17.3 12,156 Exports, Electrical Machinery (f.a.s. value in millions of dollars)² SEP 6,613.00 6,641.00 -0.4 6,588.00 0.4 76,736.00 U.S. Dollar vs. Other Major Currencies (1973=100)⁵ OCT 98.9 98 0.9 98.8 0.1 101.9 PRICES & INTEREST RATES Industrial Commodities Wholesale Price Index (Bureau of Labor Statistics, 1967=100) OCT 202.3 204.8 -1.2 188.4 7.4 187 Electrical Price Index (Electrical Marketing, 1997=100) OCT 139.5 141.3 -1.3 139.2 0.2 138.9 Construction Materials Wholesale Price Index (Bureau of Labor Statistics, 1982=100) OCT 214.2 213.9 0.1 205.9 4 205.7 Copper Prices (Metals Week, cents per pound) NOV 354.25 338.36 4.7 388.21 -8.7 346.47 Prime Rate⁵ OCT 3.3 3.3 0 3.3 0 3.3 Federal Funds Rate⁵ OCT 0.1 0.1 0 0.2 -0.1 0.2 Mortgage Rate⁷ OCT 4.1 4.1 0 4.2 -0.2 4.7

*Several series related to employment are now being reported on a NAICS basis. Because of this change, some numbers are not directly comparable to previously reported data, but are consistent in year-over-year comparisons and comparisons shown in the table.

Sources: ¹McGraw-Hill Construction/Dodge; ²Dept. of Commerce; ³Manufactured Housing Institute; ⁴Dept. of Labor; ⁵Federal Reserve Board; ⁶The Association for Manufacturing Technology; ⁷Federal Home Loan Bank Board.

Note: Some figures shown — prime rate, for example — are averaged for month. NYA — not yet available SA-seasonally adjusted. SAAR-seasonally adjusted annual rate. Source for chart: Global Insight.

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