With a reading of 49.4, the Gardner Business Index showed that, after five consecutive months of growth, the moldmaking industry contracted very slightly in April for the second month in a row. Compared with April 2014, the industry contracted 9.5 percent, the third time in four months that the month-over-month rate of change contracted. The annual rate of change was still growing in April, but at its slowest rate since March 2014.
New orders were unchanged for the second month in a row. Production expanded at a slightly slower rate than in March but has increased for seven straight months. Backlogs continued to contract, but that rate of contraction slowed somewhat in March and April. Compared with one year earlier, backlogs contracted 16.6 percent in April, the second consecutive month with a contraction greater than 16 percent and the third month in a row that backlogs have contracted. Based on the annual trend, capacity utilization has seen its peak rate of growth in this particular cycle. Employment increased in March and April, and the employment index has been trending up since September 2014. Exports generally have contracted since mid-2014 due to the relatively strong dollar. Supplier deliveries lengthened marginally, indicating that there is a general slowdown in manufacturing activity.
Material prices increased in April after decreasing the previous two months, however, the rate of increase was still virtually the slowest since the index began in December 2011. Prices received contracted for the fourth month in a row, and this rate of decrease accelerated each of those months. Future business expectations declined to their lowest level since October 2014.
Plants with 20-99 employees recorded expanding business conditions in April. an improvement over the previous month, however, facilities with fewer than 20 employees moved in the opposite direction. These plants showed significant acceleration in their rate of contraction to their fastest rate since September 2014.
Metalcutting job shops expanded for the fifth time in seven months, and all but one of those months have had a fairly strong rate of growth. After five months of growth, custom processors saw a fairly significant contraction in April.
The North Central–West region was the fastest growing in April, expanding for the fourth time in five months. It was followed by the North Central–East and Northeast regions. The North Central–East region grew for the seventh consecutive months, while the West contracted in April after being the fastest growing region in March.
Future capital spending plans have taken a huge hit recently. In April, spending plans contracted 71.1 percent compared with one year earlier. The annual rate of change has contracted for four straight months and now stands at -18.6 percent.