Electrical Marketing's Key Economic Indicators

Dec. 23, 2011
AIA bounces into positive territory Continuing the positive momentum of a nearly three-point bump in October, the Architecture Billings Index (ABI) hit

AIA bounces into positive territory

Continuing the positive momentum of a nearly three-point bump in October, the Architecture Billings Index (ABI) hit growth territory in November for the first time since August. As a leading economic indicator of construction activity, the ABI, published monthly by the American Institute of Architects (AIA), Washington, D.C., reflects the approximate nine- to twelve-month lag time between architecture billings and construction spending.

The AIA reported the November ABI score was 52 points, a 2.6-point increase over October. This score reflects an overall increase in demand for design services (any score above 50 indicates an increase in billings). The new projects inquiry index was 65 points, up dramatically from a reading of 57.3 points the previous month.

“This is a heartening development for the design and construction industry that only a few years ago accounted for nearly ten percent of overall GDP but has fallen to slightly less than six percent,” said AIA Chief Economist, Kermit Baker. “Hopefully, this uptick in billings is a sign that a recovery phase is in the works. However, given the volatility that we've seen nationally and internationally recently, we'll need to see several more months of positive readings before we'll have much confidence that the U.S. construction recession is ending.”

PMI increases 1.9 points in November

The Purchasing Managers Index ventured further into growth territory last month with a 1.9-point increase to 52.7 points. The PMI had been stuck in a range of 50-51 points since July, which is dangerously close to the sub-50 levels that indicates a contracting economy, according the Institute of Supply Management, Tempe, Ariz., which publishes the PMI each month.

Machine tool orders up 80.5% YTD over 2010

U.S. orders for machine tools in October totaled $463.32 million, according to the Association For Manufacturing Technology (AMT) and AMTDA, the American Machine Tool Distributors' Association. This total was down 22.4% from September but up 20.3% when compared with the total of $385.21 million reported for October 2010. With a year-to-date total of $4.53 billion, 2011 is up 80.5% compared with 2010.

The Marketplace : Key Figures

Month Latest month Previous month Month-over-month % change Year ago Year-over-year % change 2010 annual CONSTRUCTIONNew Construction Put in Place
(Billions of dollars, SAAR)2
Total OCT 798.53 792.11 0.8 802 -0.4 801.88 Offices OCT 23.73 23.03 3 23.56 0.7 24.29 Industrial OCT 37.78 37.93 -0.4 33.16 13.9 37.63 Housing Starts (Thousands of units, SAAR)2 NOV 685 627 9.3 551 24.3 585 Single-unit NOV 447 437 2.3 454 -1.5 471 Mobile Home Shipments3
(Thousands of units, SAAR) OCT 62 55 12.7 44 40.9 50 Employment, Construction Workers (Thousands)4 NOV 5,657 5,777 -2.1 5,645 0.2 5,526 Employment, Electrical Contractors (Thousands)4 OCT 745 749.6 -0.6 736 1.2 723.2 Hourly Wage, Electrical Contractors4 OCT 25.78 25.84 -0.2 25.68 0.4 25.26 PRODUCTIONIndustrial Production Index (1967=100)5 NOV 94.8 95 -0.2 91.4 3.7 90.1 Construction Supplies Production Index5
(1977=100-SA) NOV 77.7 77.4 0.4 75 3.7 72.7 Employment in Electrical Equipment & Supplies Mfg. Production workers (Thousands)4 OCT 141.3 140.8 0.4 137.4 2.8 136.3 Weekly hours OCT 42.9 43.6 -1.6 43.3 -0.9 42.2 Hourly wage OCT 18.42 18.37 0.3 16.65 10.6 16.51 Electric Power Output Index (1967=100)5 NOV 99.4 98.8 0.6 99.1 0.3 100.6 Machine Tool Orders* (Millions of dollars)6 OCT 424.51 544.75 -22.1 368.02 15.3 Industrial Capacity Utilization (Percent, SA)1 NOV 75.79 76.07 -0.3 73.39 2.4 71.86 TRADEElectrical Mfrs' Shipments OCT 3,797 3,857 -1.6 3,592 5.7 Electrical Mfrs' Inventories (Millions of dollars, SA)2 OCT 4,840 4,757 1.7 4,960 -2.4 4,713 Electrical Mfrs' Inventory-to-Shipments Ratio OCT 1.275 1.233 3.4 1.381 -7.7 1.364 Electrical Mfrs' New Orders
(Millions of dollars, SA)2 OCT 3,881 3,760 3.2 3,659 6.1 Electrical Mfrs' Unfilled Orders
(Millions of dollars, SA)2 OCT 14,608 14,524 0.6 12,546 16.4 12,156 Exports, Electrical Machinery
(f.a.s. value in millions of dollars)2 OCT 6,722.00 6,613.00 1.6 6,780.00 -0.9 76,736.00 U.S. Dollar vs. Other Major Currencies (1973=100)5 NOV 99.5 98.9 0.6 99.1 0.4 101.9 PRICES & INTEREST RATESIndustrial Commodities Wholesale Price Index
(Bureau of Labor Statistics, 1967=100) NOV 202.8 202.3 0.2 189.2 7.2 187 Electrical Price Index
(Electrical Marketing, 1997=100) NOV 141.6 141.1 0.4 141 0.4 138.9 Construction Materials Wholesale Price Index
(Bureau of Labor Statistics, 1982=100) NOV 214.1 214.2 0 206.3 3.8 205.7 Copper Prices (Metals Week, cents per pound) DEC 349.29 348.22 0.3 420.97 -17 346.47 Prime Rate5 NOV 3.3 3.3 0 3.3 0 3.3 Federal Funds Rate5 NOV 0.1 0.1 0 0.2 -0.1 0.2 Mortgage Rate7 NOV 4 4.1 -0.1 4.3 -0.3 4.7 *Several series related to employment are now being reported on a NAICS basis. Because of this change, some numbers are not directly comparable to previously reported data, but are consistent in year-over-year comparisons and comparisons shown in the table.

Sources: 1McGraw-Hill Construction/Dodge; 2Dept. of Commerce; 3Manufactured Housing Institute; 4Dept. of Labor; 5Federal Reserve Board; 6The Association for Manufacturing Technology; 7Federal Home Loan Bank Board.

Note: Some figures shown — prime rate, for example — are averaged for month. NYA — not yet available
SA-seasonally adjusted. SAAR-seasonally adjusted annual rate. Source for chart: Global Insight.

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