Manufacturers hired 417,000 workers in January, an increase from 405,000 in December.Total separations—quits, firings, layoffs and retirements—increased to 399,000 from December’s 384,000.
Net hiring—hiring minus separations—totaled 18,000 in January.
This is down from 32,500, the net-hiring average for the past year.
The bigger picture: January’s numbers are down from the average of the past year, 844,750, which is well above pre-pandemic levels.
January saw more openings at nondurable goods firms than at durable goods firms.
Quits: Total quits in the manufacturing industry were nearly unchanged in January, slipping slightly to 260,000 from December’s 263,000.
Overall manufacturing quits have dipped since peaking in March 2022.
Total quits in the U.S. economy declined to 3.88 million, the slowest pace since May 2021 and down from 4.09 million in December.
- Jobs numbers: Manufacturing employment declined by 4,000 in February, dipping for the first time in almost two years, according to the Bureau of Labor Statistics. In the larger economy, employers added 311,000 jobs.
- Debt: Total credit card debt among Americans reached a record high at the end of last year, according to CNBC.
New orders for manufactured goods have continued to seesaw, falling 1.6% in January largely on volatility with nondefense aircraft and parts orders. New factory orders excluding transportation rose 1.2% in January. In addition, new orders for core capital goods—a proxy for capital spending in the U.S. economy—rose 0.8% in January to a level not far from August’s record.
- There were decent rebounds in demand in January in most manufacturing sectors, but it is also clear that manufacturing activity has stalled since the summer. While new factory orders have increased 4.3% over the past 12 months, sales have fallen 2.1% since June.
- The J.P. Morgan Global Manufacturing PMI stabilized after contracting for five straight months, rising to 50.0 in February. Output expanded for the first time since July, and hiring increased after being neutral in the previous survey. Encouragingly, delivery times narrowed for the first time since July 2019, with supply chain bottlenecks continuing to improve.
- Manufacturing production edged up 0.1% in February, sustaining the 1.3% rebound in January but reflecting stagnant growth for the month. Since April 2022, when manufacturing production rose to its highest level since August 2008, output in the sector has slowed somewhat modestly, pulling back 2.1% in the past 10 months on weaker global growth and ongoing geopolitical and economic uncertainties.
- A more favorable interpretation might be that these declines have come off of a strong base, following sizable growth over the past few years. The current forecast is for manufacturing production to decline 1.0% in 2023 but expand 2.0% in 2024.
- Surveys from the New York and Philadelphia Federal Reserve Banks both reflected sharp contractions in manufacturing new orders in March, with weaker data across the board. The outlook for the next six months was varied between the two reports.