Shipments from U.S. electronics factories were nearly steady in November, rising a slim 0.2 percent from October.

Put in perspective, the double-digit growth trend continues with the marginal growth in November averaged with the outsized shipments rise in October. Orders for computer and electronics equipment expanded at a 12 percent annual pace over the last three months, and declines in October and November were more than offset by a huge rise in September.

Volatile telecom orders plunged 35 percent after an even larger rise in the previous two months. Semiconductor shipments increased for the second month, suggesting that the mid-year surplus of electronic components in the supply chain continues to be worked off.

Electronics, machinery and transportation all had steady or declining November shipments. This would be an ominous sign of plunging investment demand had capital goods orders not risen a healthy 1.6 percent from October and unfilled orders jumped 1.7 percent from the previous month.

While capital goods manufacturers increased their inventories 1.5 percent from October, this more likely reflects a catch-up in parts and materials stocking and a build-up in work in process rather than an unwanted pile-up of finished products. Electronics inventories rose 0.7 percent, which suggests that modest inventory reductions are still being made.

Other reports for November confirm that the manufacturing expansion is continuing. Manufacturing production increased at a 4 percent annual pace and aggregate hours worked in factories, while down 0.2 percent, were enough with currently high labor productivity gains for a 4-5 percent annual expansion rate.

By: DocMemory
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