June 21, 2011
by Michael Power
PURCHASINGB2B MAGAZINE: JUNE 2011
The Purchasing Management Association of Canada (PMAC) has partnered with UK-based financial information services company Markit and the Royal Bank of Canada to launch the monthly RBC Canadian Manufacturing Purchasing Managers’ Index.
The PMI is a composite indicator designed to provide a single-figure snapshot of the health of the country’s manufacturing sector. The survey tracks changes in: output; new orders; employment; inventories; prices and supplier delivery times. Index readings above 50 signal expansion from the previous month, while lower readings indicate a contraction.
“For us, the overarching reason for being involved is that one of PMAC’s core mandates is to promote the strategic value that supply chain managers contribute both to their enterprises and to the Canadian economy as a whole,” said PMAC president and CEO Cheryl Paradowski, during the launch of the index in Toronto. “For us, the PMI does an excellent job of enhancing the profile of purchasing and supply chain management decisions.”
The headline PMI registered 54.8 in May, down from 56.3 in April. The latest reading posted above the 50 no-change level and signaled an improvement in business conditions for the eighth month in a row.
Key findings from the survey include:
• The PMI fell for the second month running;
• There was a rise in employment but at a slower rate than the previous month; and
• Suppliers’ delivery times lengthened further as vendors struggled to source raw materials.
Business conditions in the Canadian manufacturing sector improved at a slower pace in May, the index showed, indicating weaker expansion of output and new orders. However, job creation remained solid and similar to that registered in the previous survey period. Suppliers’ delivery times lengthened further, while input prices rose at a marked rate during May.
The index is available online at www.rbc.com/newsroom/pdf/pmi-June_11-rpt. b2b