The manufacturing sector in the U.S. started 2011 with quickening expansion and higher prices, signaling that the economic recovery has gained strength into the New Year, according to Bloomberg. On Tuesday, the Institute for Supply Management found its index of national factory activity reached 60.8 in January after reading 58.5 in December and outpacing economists’ forecast for a level of 58 that would have indicated a slightly muted rate of growth.
The sub-index for new orders showed almost a six-point jump to 67.8, marking a seven-year high, while the gauge for employment added about three points to hit 61.7. Prices surged nine points to reach 81.5. A separate report from the Commerce Department showed a 2.5% drop in construction spending during December, which represents the steepest fall since July and brought the value of all projects to a ten-year low of $787.9 billion. The data suggests that the housing market continue to lag behind the overall economic recovery as manufacturing and other sectors drive growth.
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Click here for coverage of construction spending from Bloomberg News.