Manufacturing activity in Georgia continued to decline in August, accordingto the Econometric Center at Kennesaw State University’s Michael J. Coles College of Business. Georgia’s Purchasing Managers Index (PMI), a reading of economic activity in the state’s manufacturing sector, was down 1.4 points from July, to 50.4, with new orders and supplier delivery time accounting for the decline. New orders fell 6.8 points, to 50; supplier delivery time fell 7.8 points, to 44.4. Georgia’s PMI is only slightly higher than the national PMI reading of 49.6.

`Georgia’s PMI started to decline in May, and the decline has extended into the third quarter,` said Don Sabbarese, professor of economics and director of the Econometric Center at the Coles College of Business. `Double-digit declines in new orders and production over the past four months demonstrate the extent of this slowdown.`

Other highlights of the August PMI include:

Production was up 1 point, to 55.6

Employment was up 0.4 of a point, to 48.1

Finished inventory was up 6 points, to 53.7

Commodity prices were up 8.7 points, to 51.9

The Georgia PMI provides a snapshot of manufacturing activity in the state, just as the monthly PMI released by the Institute for Supply Management provides a picture of national manufacturing activity. A PMI reading above 50 indicates that manufacturing activity is expanding; a reading below 50 indicates it is contracting.

The PMI’s value is in its timeliness and sensitivity to variables such as interest rates, global markets and other economic changes. The Georgia PMI provides valuable data used by institutions such as the Federal Reserve Bank of Atlanta to assist in their analysis of current economic conditions, along with many other data sources, to get a picture of economic activity.