The manufacturing and construction sectors of the economy are currently facing tough times, with several challenges impacting their performance. According to the Institute for Supply Management’s Purchasing Manager’s Index for manufacturing, there was contraction in May, marking a continued decline over the past year and a half. In addition, factory orders remained low, while government reports indicated a fall in construction spending in April. These issues have been attributed to high interest rates and weak demand for manufactured goods.
Despite this downturn, job stability has remained somewhat constant in both manufacturing and construction. Kathy Bostjancic, the chief economist at Nationwide, explained that the economy has been driven by service consumption rather than goods consumption, which has resulted in softness within the manufacturing sector. With high interest rates, costs are higher for building houses or purchasing new business equipment. However, despite the downturn, job stability has remained somewhat constant in both manufacturing and construction.
Economist Bill Adams from Comerica Bank noted that while manufacturers have been holding onto their workers due to fears of a future staffing shortage, the physically demanding nature of manufacturing jobs may be challenging for recruitment. Despite this, manufacturing employment has remained stable in recent months, with construction employment on the rise.
