Economic Watch: Manufacturing Slips as E-Commerce Jumps
New economic reports this week paint a picture of a U.S. economy that continues to gain momentum following a slow start to the year, due in part to increased e-commerce – despite some bumps in the road for manufacturing and housing.
Fewer Car Sales Mean Sluggish Manufacturing Numbers
Industrial production rose 0.2% in July from the month before, following an increase of 0.4% in June, according to Federal Reserve figures issued Thursday morning
In July, manufacturing output edged down 0.1% as the production of motor vehicles and parts fell substantially, marking the third straight monthly drop. That decrease was mostly offset by a net gain of 0.2% for other manufacturing industries. When the manufacturing sector is compared to a year earlier, it is up 1.2%.
The indexes for mining and utilities in July rose 0.5% and 1.6%, respectively, from the month before.
At 105.5% of its 2012 average, total industrial production was 2.2% above its year-earlier level.
“This report, which is the first definitive look at July’s factory sector, is unexpectedly flat and puts an end to the run of recently strong economic data,” said analysts at Econoday. “Vehicle sales were up in July, but it has been a tough year for the sector. And given the decline in this report’s manufacturing component, the upward momentum that the factory sector was showing looks less certain now.”
The report follows a separate one earlier in the month focusing exclusively on the manufacturing sector. It showed factory activity in July continued growing but the pace was slower than it was during June.
Manufacturing is estimated to make up about 12% of all U.S. economic activity.
E-Commerce Growing by Leaps and Bounds
A separate report released Thursday by the Commerce Department showed U.S. e-commerce in the second quarter grew significantly and faster than overall U.S. retail sales.
The 4.8% increase from the …Read the rest of this story
