Georgia manufacturing activity continued to improve in March as the lingering effects of a harsh winter dissipated and new orders and production experienced significant jumps, according to the Purchasing Managers Index released Tuesday by Kennesaw State University’s Econometric Center in the Michael J. Coles College of Business. 

“It’s apparent this upswing was weather related, but what is not clear is how much of this catch-up is sustainable at this level,” said Don Sabbarese, director of the Econometric Center and professor of economics at Kennesaw State. The Georgia PMI for March is 62.5, up 5.8 points, while the National PMI for March rose 0.5 points to 53.7.

According to the report, Georgia’s new orders and production are up by 20.9 and 27.4 points, respectively, over the past two months. Fifty percent of respondents reported higher new orders, and 43 percent reporter higher production for March. However, Sabbarese said it is still too early to determine how much of these new order and production increases were delayed by weather and how much is related to new demand.

Other highlights from the March PMI:

• New orders up 7.7 points to 66.1, 11.7 points above its six-month average
• Production up 13.7 points to 67.9, 14.6 points above its six-month average
• Employment up 8.0 points to 64.3, 7.2 points above its six-month average
• Supplier delivery down 7.4 points to 57.1, 0.9 of a point above its six-month average
• Finished inventory up 7.1 points to 57.1, 4.0 points above its six-month average
• Commodity prices up 3.3 points to 55.4, 2.1 points above its six-month average

The Georgia PMI provides a snapshot of manufacturing activity in the state, just as the monthly PMI released by the Institute for Supply Management provides a picture of national manufacturing activity. A PMI reading above 50 indicates that manufacturing activity is expanding; a reading below 50 indicates it is contracting.   

About Dr. Don Sabbarese

Dr. Donald Sabbarese specializes in the area of macroeconomics and financial institutions at Kennesaw State University. He directs the Georgia Purchasing Managers Survey and other research involving the local economy, such as industry surveys and economic impact studies. His work at the Econometric Center has been reported in the regional and national media. He is a frequent speaker to business and civic groups and has contributed to local magazines and other news media outlets. Dr. Sabbarese has testified before Georgia legislative committees on matters related to bank legislation.