Key Points – March Report
The Chicago Business Barometer, produced with MNI, recovered to 62.9 in March, after last month’s dip to 56.3. Inventories reached levels not seen since 1973.
- All main indicators increased, with Inventories and New Orders seeing the largest boost. Only prices paid declined in March.
- Production improved to 60.0, still below the 12-month average of 62.8, but a substantial 4.6-point recovery over last month. Firms cited modest improvements in material shortages and logistic issues, allowing a production boost.
- Employment increased 4.6 points to 48.1, following February’s dip to the lowest since October 2020. Firms saw employment levels improve, although hiring skilled workers remained challenging.
- New Orders picked up to 61.9, up 8.9 points from the February fall, yet still 3.4 points weaker than January.
- Supplier Deliveries rose 3.0 points through March to 78.3, with more firms seeing deliveries slow.
- Order Backlogs inched up 2.5 points to a five month high of 64.3 as backlogs remained persistently high due to key material and chip shortages.
- Inventories hit a near 50-year high in March, jumping 11.4 points to 68.7, 16.7 points above the 12-month average. Firms stocked up due to ongoing supply chain disruptions, with exports seeing longer delivery times. Some port congestion improvements were noted.
- Prices Paid slipped 0.8 points to a - still elevated -12-month low of 85.7 in March.
- Increased lead times and capital costs sent the capital equipment subindex to a record high.
This month we again asked firms whether they areseeing any easing up in the supply chain blockages.Just over half of respondents said no, followed by close to 36% seeing some easing. 5% of firm saw definite easing, whilst close to 8% were not affected.
