Manufacturing productivity remains strong

By Staff -- Modern Materials Handling, 4/1/2007

The final economic numbers for 2006 are in, and they reveal continued strength in U.S. manufacturing and in the market for materials handling equipment.

While overall worker productivity grew just 1.6% last year, productivity in the manufacturing sector grew 4%. And while overall labor costs rose 3.2%, manufacturing labor costs actually decreased slightly.

Durable goods manufacturing continues to be the strongest performing sector of the economy. This is due, in part, to investments in labor-saving materials handling equipment, says Jim Haughey, an economist for Modern’s parent company Reed Business Information.

In fact, orders for materials handling equipment grew 10% in 2006, according to the Materials Handling Industry of America (MHIA, www.mhia.org). This follows a record 20.9% growth rate in 2005. MHIA predicts orders for materials handling equipment will continue to grow at a modest pace in 2007 but may contract slightly in 2008.

Modern’s orders index shows the third quarter was the weakest of 2006, but orders rebounded in Q4.