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

ECONOMIC SLIDE CONTINUES

JOB DROP ACCELERATES

..........HOUSTON December 10th, ----- The Houston PMI (Purchasing Managers Index) slipped further in November, falling to 48.1 from October’s 48.6, indicating further shrinkage of the Houston economy. Prior to October, the PMI had reflected 31 months of economic expansion in Houston.

..........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 Employment component of the PMI fell for the second consecutive month. This hasn’t happened since October – November, 1999," said Doug Miller, Chairman of the NAPM-Houston Business Survey Committee. "November’s Employment index dropped at twice the rate of October, making it the most negatively indexed month we’ve seen in the Employment numbers since February, 1999."

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

.........."Prices Paid fell sharply in November with 97% of survey participants reporting that prices they paid in the past month were either the same or lower than last month," said Miller. "November marked the first time in 29 months that Prices Paid reflected a net reduction for a one month period. This seems to be a clear indication that fewer buyers are chasing more goods than at anytime in the past two years plus. This coupled with obvious increased efforts to drive down inventories, seems to say a great deal about Houston-area confidence concerning near-term Sales and Production levels at area businesses of many kinds."

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