The Gardner Business Index (GBI) started the new year with a near 1-point gain to close at 58.4. The overall uptick was supported by expanding activity in new orders, production and backlog activity. After posting a 10-month low in December, the reading for supply chain performance rose 3-points, sending it back towards mid-2021 levels. Rising supply chain readings indicate worsening supply chain performance. In contrast, employment and export orders reported declines in activity levels. The decelerating expansion in employment activity has now persisted for a full 3-months. The latest reading indicated that activity January’s activity was nearly ‘unchanged’ from a month ago.  Lagging all other measures, export order activity contracted further in January than the month prior; it was the only activity component to register contracting activity in the latest readings.

The Index increased nearly 1-point as a result of accelerating expansion in production, new orders, and backlog activity.

Data trends in the 6-month period ending January suggest that manufacturers continue to try to do more with less. Production readings over the period in question have remained stable, around a level of ‘55’, while employment activity has slowed and supply chains remain extremely disrupted. This raises an obvious question: how long will it take for manufacturing to reduce backlogs which have expanded at record-setting levels for nearly a year now?

A Note About Gardner Intelligence and the GBI:

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