California Manufacturing Stalls in the
First Quarter of 2003

The Institute for Supply Management conducts a monthly national survey of purchasing managers and publishes the survey results in its Report on Business. Such a survey is not available for the state of California. Given the size of our state, and the major role its manufacturing sector plays in the national economy, the A. Gary Anderson Center for Economic Research at Chapman University launched a quarterly survey of California purchasing managers starting in the third quarter of 2002. The survey tracks changes in production, employment, new orders, inventories of purchased materials, commodity prices and supplier deliveries. For each variable a seasonally adjusted index is computed.

In order to have one single indicator for the performance of the state manufacturing sector, the Anderson Center has developed a Composite Index which is a weighted average of the various variables’ indexes. A value of 50 for the Composite Index shows a general expansion of the manufacturing economy of the state and a value below 50 shows a decline. The Composite Index decreased from 54.7 in the fourth quarter of 2002 to 49.3 in the first quarter of 2003, indicating that the California manufacturing sector showed a marginal decline in the first quarter of 2003. Production and commodity prices increased while new orders showed only a marginal increase. Inventories of purchased materials and employment decreased substantially.

The index for the high-tech industries stood at 39.1 indicating that the high-tech industries declined in the first quarter. The index for the non-durable goods industries stood at 52.8 indicating growth. The index for the durable goods industries other than high-tech stood at 53.6 indicating the strongest growth compared to the other industry groups.

Production was reported to have increased most rapidly in the following industries: Food Products; Apparel; Chemicals; Plastics & Rubber Products; Fabricated Metal Products; Wood Products; and Transportation Equipment. New orders were reported to have increased most rapidly in the following industries: Apparel;Chemicals; Plastics & Rubber Products; Fabricated Metal Products; and Electrical Equipment, Appliance & Components. Employment was reported to have decreased most rapidly in the following industries: Textile Products; Paper Products; Primary Metal Products; Electrical Equipment, Appliance & Components; Furniture & Related Products; and Computer & Electronic Products.

This report is published quarterly by the A. Gary Anderson Center for Economic Research of Chapman University for more information please contact Dr. Raymond Sfeir, Professor of Economics at (714) 997-6693.

Home | About NAPM-OC | Membership | Resources | Spotlight | Site Index

This page was last updated 05/04/03
Please contact webmaster with any problems concerning this site. Thank you.
Copyright © 1997-2003 NAPM-OC ALL Rights Reserved