New PMI Survey Benchmarks Manufacturing Growth
Tuesday, October 2nd,2002
New PMI survey benchmarks manufacturing growth
The Employers & Manufacturers Association (Northern) is pleased the new ANZ - Business New Zealand Performance of Manufacturing Index (PMI) is underway with first results showing growth prospects for manufacturers in the northern region.
"The PMI is a first class leading edge indicator of how the economy overall is performing," said Alasdair Thompson, EMA Northern's chief executive.
"Though it draws data just from the manufacturing sector, including dairy and meat processors, the same Index in Australia, the US and Europe has proved very reliable in showing where new trends surface, and how their economies are tracking.
"Ours is expected to do the same. Furthermore, the PMI will be valuable tool for our manufacturers to benchmark their performance against those in the other countries.
"Since our association is the source of about half the responses nationally in the index, we expect to draw useful conclusions that apply specifically to the northern part of the country.
"In fact the Index should prove adequately responsive at the regional level for the Waikato, Bay of Plenty, Auckland and Northland.
"The inaugural ANZ-Business NZ PMI for August shows growth in all component indexes (production, employment, new orders, finished stocks and deliveries). Highest growth was recorded in the 'new orders' index - a positive result, as this index has flow-on effects into the other indexes.
"The PMI uses a points system - readings above 50 indicate growth and readings below 50 indicate decline. The distance from 50 indicates the relative strength of the expansion or decline.
The first survey for August 2002 recorded 57.7 points for the main index for the Northern region (north of Taupo), just below the national average of 58.2 points. The 'new orders' sub index recorded 60.2 which was just below the national average of 61.2.
"The food and beverage sector displayed the highest overall PMI figure of 65.5.
"Of the four regions (Northern, Central, Canterbury/Westland and Otago/Southland), all showed a rise across all components. Canterbury/Westland showed the largest rise at 62.0. Firms of all sizes reported expansion in August, with the highest overall PMI index figure from medium-large sized firms (those with 51-100 workers) at 61.7.
"The overall index of 57.7 for the EMA Northern region is slightly lower than Australia's of 59.7 but compares favourably with the US (50.5), Europe (51.6) and Hong Kong (50.3)"
General comments: Alasdair Thompson tel 09 367 0911 (b)
09 303 3951 (h)
0274 982 024