Manufacturing Rebounds: Are Jobs Far Behind?
A report released Monday shows the manufacturing sector has rebounded. The Institute for Supply Management's manufacturing reading was the strongest since April 2006. The hope now is that companies will start to rehire employees, however many may try to produce more without hiring at all.
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RENEE MONTAGNE, host:
And some good news from American factories: They got busier in October. Production continued to pick up, and for the first time in more than a year, manufacturing employment got a boost too.
NPR's Brian Reed has more.
BRIAN REED: Manufacturers haven't had a month this good since April of 2006, according to a report from the Institute for Supply Management. And the increase in employment was especially encouraging. After the 2001 recession, it took a couple of years for factories to start hiring again. This report suggests factories have started bringing on employees much sooner. Still, the good news might just be a reflection of how bad things were.
Nigel Gault is chief U.S. economist for IHS Global Insight, a forecasting firm. He says factories laid off so many workers and slashed so much inventory that even the slightest jump in demand means they have to step up production.
Mr. NIGEL GAULT (Economist, IHS Global Insight): Now it seems that sales are probably stabilizing, perhaps inching higher. And as a result of that, if companies don't increase their production, they're going to find out that the inventories of goods are simply going to become exhausted.
REED: That could mean more workers, for now. Once manufacturers restock their inventories, they may stop hiring. And some factories may try to produce more without adding any workers. So Gault says it's not quite time to celebrate. The government releases October's full employment numbers at the end of this week.
Brian Reed, NPR News.
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