The double-dip manufacturing recession failed to subside in second-quarter 2003, according to the quarterly Manufacturers Alliance/MAPI Analysis of Selected Industrial Indicators, a report that analyzes 28 major industries.
Second quarter 2003 figures show that only 11 of the 28 industries tracked in the report had inflation-adjusted orders or production above the level of one year ago, down from 14 industries in first quarter 2003 and 17 industries in fourth quarter 2002.
Top industry performers recording double-digit growth were electronic computers; aircraft and parts; defense capital goods; mining, oil field, and gas field machinery; and search and navigation instruments.
Daniel Meckstroth, Ph.D., Manufacturers Alliance/MAPI chief economist and author of the analysis writes that nine industries are in the accelerating growth (recovery) phase of the business cycle, four industries are in the decelerating growth (expansion) phase, two industrial sectors appear to be in the accelerating decline (early recession) phase and 13 industries are in the decelerating (late recession and very mild recession) phase of the cycle.
"The month of April was a disaster for manufacturing industries, but the good news is that business conditions have improved since that time," Meckstroth said. "The preliminary report for industrial production showed that manufacturing production rose in July."
The trade deficit in manufacturing industries continued to worsen in the first half of 2003, and the declining exchange value of the U.S. dollar, down 18% against major currencies from February 2002 to June 2003, has had minimal impact thus far.
In the first six months of 2003, the trade deficit in manufacturing industries averaged $32 billion per month, on pace to exceed the average of $30.2 billion per month in 2002.
Although manufacturing supply (domestic shipments plus imports) recovered in late 2002 and 2003, imports have taken most of the growth in the market. In the first half of 2003 domestic supply was $9.4 billion per month greater than in the same period in 2002. Domestic manufacturers' shipments accounted for only $3.5 billion per month of that supply, with the remaining $5.9 billion per month satisfied through rising imports of manufacturing industry goods.