Industrial growth slowed in November National Strength Index improved

The November Procurement Managers Index published by D&B Israel and the Israel Purchasing and Logistics Managers Association, indicates slower industrial growth. The index value for November was 54%, compared with 63.7% for October. According to D&B The Procurement Managers Index for November was above 50% for the 12th consecutive month ( 50% is the dividing line between economic expansion and contraction ).
 
The Israel Purchasing and Logistics Managers Association and D&B Israel produce the index on the basis of nationwide surveys of procurement managers of leading Israeli manufacturers. The index examines changes in companies' activities, including domestic demand, export demand, output, inventory, and employment an analysis of the Procurement Managers index components provided by D&B Israel show the following :
The employment component fell to 57.1% in November from 68% in October.
The local demand component in the November index was 53.4%, compared with 75% in October.
The export demand component fell to 53.3% in November from 62.2% in October.
The output component fell to 54.7% in November from 67.4% in October.
The price component in November was above 50% the 16th consecutive month, reaching 91.9%, compared with 84.3% in October. Higher prices for raw materials were mainly responsible for the rise in prices.
 
At the Israel Democracy Institute Annual Economic Conference held last week, professor Rafi Melnick said that the economic component of the National Strength Index improved, however the social component deteriorated. Prof. Melnick said that figures for 2003 indicated a sharp deterioration in the index's social components. The most severe indicators, according to Melnick were the sharp increase in poverty and in the number of unemployed. Melnick reiterated that updated economic figures for 2003 indicate a positive turnaround in the economic dimension, especially thanks to the decline in inflation, after the sharp rise in prices in 2002.
 
Melnick added that preliminary estimates for 2004 indicated that the improvement continued, thanks to rising GDP in general and GDP per capita, in particular. Melnick emphasized that the economic component of the National Strength Index improved over the past two years, and that last year's 0.8% improvement outperformed the OECD average.