| National Association of |
| Purchasing Management - Houston, Inc. |
| PO Box 771203 - Houston, Texas
77215-1203
|
NAPM - HOUSTON BUSINESS REPORT |
|||
|
Press
Release |
HOUSTON
ECONOMY EXPANDING |
PMI
RISES FOR 2ND MONTH |
| ..........HOUSTON, July 10th - The Houston economy
grew in June for the second consecutive month as the PMI
(Purchasing Managers Index) moved further into positive
territory, registering 52.3 for the month. May's PMI was
51.1 and May recorded the first plus-side (over 50) month
for the PMI since September 2001. The June growth was
spurred by Sales, which improved in May and again in
June, and by the Production rate, which rose from -2 in
May to +7 in June. ..........The Houston PMI, which can range from 0 to 100, is a leading indicator for industrial production, typically forecasting change by three to four months. A reading above 50 indicates that the Houston economy is generally expanding. A reading below 50 indicates the economy is generally contracting. The PMI is based on a monthly survey of some 80 purchasing executives in leading Houston industries, including oil and gas exploration and production, manufacturing, engineering and construction, chemicals, distribution, business and financial services and healthcare, among others. .........."The Production rate improvement follows directly on the heels of May's significant Sales rate rise, implying that virtually nothing can be shipped "off-the-shelf", but must be produced to fill a new sales order. If this is the case in most firms, and 47 months of inventory reductions seem to give witness to that, further economic growth could be hampered by limited ability to meet Sales demands," said Doug Miller, Chairman of the NAPM-Houston Business Survey Committee. "Purchases are still declining, as they have been for ten months, but that could change very soon." ...........There are eight components of the PMI, including Sales, Production, Employment, Purchases, Prices Paid, and Inventory levels. .........."Employment numbers continued to contract in June for the ninth consecutive month, reflecting the same kind of caution that has brought about the massive inventory drawdown," said Miller. "Even though overall job numbers are falling, some positions calling for highly skilled people are continuing to be very difficult to fill." |
|