video-banner
none

MANUFACTURING EDGES BACK FROM THE BRINK

01-08-2019
by 
in 

Australian manufacturing rallied in July, with the Ai Group’s Performance of Manufacturing Index edging back into positive territory at 51.3 points, following June’s mild contraction. The improved performance comes despite sharp falls in both sales and production, but backed by improvements in new orders, exports and supplier deliveries.

The ever-growing food and beverage sector continues to lead the growth (albeit slightly down to 59.2) and the building materials sector continues to defy the go-slow in residential construction with a new high of 63.7. On the down side, the metals sector continues its serious contraction at 35.4 and the machinery and equipment sector is still below par at 48.8.

Some of the underlying figures do seem to indicate that the industry is still struggling to stay ahead. Although the rate of growth of input prices is easing, at 66.3 that is still a worryingly high figure when compared with a selling price index that is becalmed at 49.2.

Meanwhile, wage growth is easing at 56.9, in spite of the 3 per cent increase in the minimum wage, which came into effect at the start of the month.

Ai Group Chief Executive Innes Willox was optimistic in announcing the results, saying: “While production fell, export sales were stronger partly due to the downward drift in exchange rates over the first half of 2019 and partly due to strong overseas demand for food, beverages, pharmaceutical and cosmetic products.

“Pressures on manufacturers’ margins continued in July in the face of weak domestic sales and selling prices even though the pace of increases in wages and other input costs eased. In encouraging pointers for the months ahead, both new orders and employment expanded in July,” he concluded.

 

 

Related news & editorials

  1. 15.07.2019
    15.07.2019
    by      In
    A new report from the Committee for Economic Development of Australia (CEDA) concludes that immigration to Australia has not harmed the jobs and earnings of local workers. The report, “Effects of temporary migration”, examines the impact of immigration and recent trends in temporary migration... Read More
  2. 09.07.2019
    09.07.2019
    by      In
    New research from the University of South Australia suggests that companies prioritising the environment are the ones reaping the financial rewards, contrary to the common perception that many businesses put profit first and a healthy planet a distant second.
    The study analysed 24,393 diverse firms... Read More
  3. 02.07.2019
    02.07.2019
    by      In
    Numerous studies have suggested that background music in the workplace can be a contributor to improved productivity – whether in an office environment, in the warehouse or on the shop floor.
    However, playing recorded or broadcast music in the workplace requires licensing to comply with the... Read More
  4. 01.07.2019
    01.07.2019
    by      In
    Small business accounting specialist Xero has published a report that attempts to quantify the magnitude and impact of late payments to Australian small businesses. The report, “Paying the Price: the economic impact of big businesses paying Australian small businesses late”, puts the value of... Read More