Factories Roar at Fastest Clip in 20 Yrs
December 01, 2003 10:30:00 AM ET
NEW YORK (Reuters) - U.S. factories charged ahead in November at their quickest pace since 1983, far exceeding economists' forecasts and putting to rest any lingering doubts that a manufacturing recovery will prove sustainable.
As the first inklings of a jobs rebound surfaced, the Institute for Supply Management said on Monday its barometer of manufacturing activity surged to 62.8 in November from 57.0 in October. Wall Street economists had predicted a rise to 58.0.
``What we saw was an amazing month in November by just about any standard,'' said Norbert Ore, the ISM executive in charge of the survey.
A reading above 50 signals growth in the industrial sector, which makes up about a sixth of the U.S. economy and has been hardest hit by the recession and meager recovery of the past few years.
It was the latest in a series of reports pointing to continued strong growth in the world's largest economy during the fourth quarter, after a blockbuster expansion between July and September.
``It looks like we're beginning to see the manufacturing sector make up a lot of lost ground,'' said Gary Thayer, chief economist at A.G. Edwards & Sons, in St. Louis, Missouri.
U.S. stocks rallied as investors were heartened by the jump in new orders, while bond prices tanked. A harbinger of future growth, orders sky-rocketed to 73.7 from 64.3 while the employment index climbed to 51.0 from 47.7.
The job market has been this economic recovery's Achilles heel, so analysts found it encouraging to hear the ISM argue that a 37-month string of job losses in manufacturing ended in November.
The ISM report noted that factory exports had gotten a boost from a weakening U.S. dollar.
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