Metro Detroit economy growing steadily, according to survey of local purchasing managers
The Southeast Michigan Purchasing Managers Index (PMI) came in at 62.6 in April, dipping slightly from 66.1 in March. PMI index values above 50 generally suggest an expanding economy, meaning the local economy grew at a slower rate in April than in March.
“Every one of the eight individual indexes and three-month averages is at or above 50, and many are above 60,” said Timothy Butler, associate professor of supply chain management at Wayne State’s business school. “This tells us that the economy continues a healthy expansion.”
Butler said the Production Index value of 65.5 and the New Orders Index of 63.8 contributed to the healthy growth in April, as did the jump in the Employment Index to 71.4 from 65.5, which suggests that purchasing managers are observing more hiring in their companies.
The Commodity Prices Index dropped to 56.9, its lowest level since January, with purchasing managers indicating copper and natural gas down in price, and crude oil, specialty chemicals, steel, brass and resins up in price.
An overwhelming majority of purchasing managers expect the healthy climate to continue over the next six months.
“Approximately 68 percent of purchasing managers thought the business environment would remain stable, and another 17 percent thought it would become even more stable over the next several months,” said Ken Doherty, a member of the Institute for Supply Management and assistant vice president for procurement and strategic sourcing at Wayne State University. “The continued strengthening of the Big 3 Detroit automotive manufacturers is likely the underlying reason,” he said.
The Southeast Michigan Purchasing Managers Index (PMI) is a research partnership between Wayne State University’s School of Business Administration and the Institute for Supply Management – Southeast Michigan. The complete report for April is available for download here.