The January '10 Metalworking Business Index (MBI), published each month by Gardner Publications and Modern Machine Shop, showed the industry is expanding for the 6th straight month, but fell to a level of 62.7, down -0.6% from December's MBI.
The index is an aggregation of many factors that machining shops and businesses in North America report on each month, including New Orders, Production, Employment, and Future Business Expectations.
While the overall expansion of this industry is encouraging, it appears the rate of expansion is slowing. Production rose significantly over December (the 6th consecutive month of growth in that category), but Exports again dropped and Material Prices rose - both by significant margins.
"Future Business Expectations are still at a high level, but the trend has shown some softening in expectations since October, 2009," said Steven Kline, analyst at Gardner. "Two comments that could highlight this softening: 'this may be an inventory bubble' and 'people are on hold with their new budgets.'"
While there has been cause for optimism in recent months, the latest MBI shows that North American manufacturers are cautious entering 2010.