Manufacturing Snapshot

The manufacturing sector is emblematic of the wider labor market slowdown. In the second quarter, the sector lost a net total of 1,000 jobs, gaining 7,000 jobs in April, remaining steady in May, and dropping 8,000 net jobs in June. While it initially looked like it would be a solid year for the manufacturing sector, the gains in the first quarter were revised way down and sluggish growth this quarter does not reinvigorate hope. The sector is still benefiting from federal investment flows, but the construction sector may be reaping the brunt of the benefits for now.  

The manufacturing sector contracted for the third month in a row in June, according to the Institute for Supply Management (ISM) manufacturing purchasing manager’s index (PMI), a key measure of strength in the manufacturing sector. However, manufacturing production actually increased in June, surprising economists who have seen the sector flounder in recent months. With continued federal investment and the possibility of interest rate cuts, this sector could turn around and activity could pick up.  

For now, though, it is relatively stagnant. Non-durable manufacturing employment increased by 3,200, while durable manufacturing lost 10,000 net jobs. Machinery manufacturing losses in June offset any positive additions from transportation equipment or food manufacturing. Computer and electronic products manufacturing was nearly unchanged, losing just 800 net jobs.