The Australian manufacturing sector has remained buoyant in April according the latest Ai Group Australian Performance of Manufacturing Index.
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The monthly survey produced an overall reading of 58.3 points in April (readings above 50 indicate growth). Although still in expansion territory, the result actually represents a 4.8 point drop from the record activity levels seen in March.
The result marked the 19th consecutive month of expanding or stable conditions in Australian manufacturing, which is the longest run of continuous expansion since 2005.
“The manufacturing sector extended its broad-based expansionary run in April,” Ai Group chief executive Innes Willox says.
“Growth was led by the machinery & equipment; metal products; coal, petroleum, chemical & rubber products; and non-metallic mineral product sub-sectors, all of which are enjoying strong demand from high levels of building and construction activity.
“While the Australian PMI reading of 58.3 indicated a slower pace of expansion than March’s record high, domestic sales, production, new orders and employment all built on recent gains,” Willox adds.
Drilling down into the sub-indexes, new orders recorded 61.6 points, production 62.1 points and sales 62.5 points indicating strong demand and a high likelihood of further growth.
Capacity utilisation for the entire sector sits at a historically high 79.9 per cent, suggesting that some manufacturers will need more employment or investment in order to meet future growth in demand.