Although the economic slowdown in the U.S. manufacturing industry continued to worsen through the first half of 2008, production rates will stabilize in the second half of the year and will begin to grow again in 2009, predicts a report on the health of the manufacturing sector issued today by the Manufacturers Alliance/MAPI trade group.
Not surprisingly, the deep <a href="http://www.managingautomation.com/maonline/news/read/2008_Shaping_Up_to_Be_a_Bumpy_Ride_31475" target="_blank">slump in the housing and construction market</a> accounted for much of the slowdown in manufacturing production in the first half of the year, with industries such as electric lighting and appliances hit hardest. Housing starts should improve 25% in 2009, however, the report predicts.
At the same time, lower interest rates, strong net exports, and the effect of government tax rebate checks sent to consumers in the second quarter will support a return to manufacturing sector growth in the second half of 2008 and stronger growth in 2009.
Overall, manufacturing industrial production declined 1.4% in the first quarter of 2008 compared with the same period a year earlier. It is expected to decline at a 2.5% rate in the second quarter ending in June, the report says.