National Association of
Purchasing Management - Houston, Inc.
PO Box 771203 - Houston, Texas 77215-1203

NAPM - HOUSTON BUSINESS REPORT

For further information, contact:
Douglas R. Miller, C.P.M. - 713-988-7306

Press Release

HOUSTON’S ECONOMY:

GROWING, BUT SLOWING

EMPLOYMENT STILL EXPANDING

HOUSTON, September 10, 2001 ----- Houston’s PMI (Purchasing Managers Index), lost ground in August to 54.6 from July’s 58.5 and in so doing recorded the lowest growth rate for the local economy since October, 1999. Even so, the Houston area economy continued to expand for the 30th consecutive month. The PMI has lost about 13% of its growth rate since January.

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 brightest spot in the PMI components for August was Employment, which showed the same positive growth rate it has had in eleven of the past twelve months," said Doug Miller, Chairman of the NAPM-Houston Business Survey Committee. "It would appear that employment is playing catch-up with the sales and production gains of the past year and a half."

There are eight components of the PMI, including Sales, Production, Employment, Purchases, Prices Paid, and Inventory levels.

"Purchases slowed in August despite low inventory levels in most organizations and August results reveal virtually no inflationary pressure," said Miller. "It’s likely that the growth rate will decelerate further but it is certainly not a given that all growth will cease."

The NAPM-Houston Business Report began publication in January 1995.
Subscriptions to the report are available through NAPM-Houston.

National Association of Purchasing Management - Houston, Inc. is an affiliate
Of the National Association of Purchasing Management.
Copyright 2001 by NAPM-Houston, Inc. All Rights Reserved