Manufacturing activity in the Philadelphia area took a huge jump in November. The headline Index for the Philadelphia Manufacturing Business Outlook survey gained more than 20 points, rising from 20.7 in October to 40.8 in November. The surge is surprising given economists expected a drop in the index to 18.5.
The dramatic upswing was met with skepticism by analysts who say the index may be an anomaly.
Paul Dales, Capital’s senior U.S. economist was quoted by CSNBC, “We’ve been optimistic on the outlook for growth for some time now, but even we think such an outturn is not possible. It’s worth remembering that the headline index is derived from a separate question on overall business conditions, which means it is vulnerable to swings in sentiment.”
Employment and hours worked both made gains in November. The employment index reached a 3 ½ year high, up 10 points to 22.4.
The price index moderated this month as the input prices fell and prices for goods sold remained steady.
Manufacturers were optimistic about the next six months with nearly 60 percent of those surveyed expecting increased activity. When asked about hiring plans, more than 40 percent expect to increase employment levels in the next six months and 56 percent over the next 12 months.
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