Michigan ranks second in export growth
After a decrease of 0.9 percent in October, foreign sales of Michigan's exporting companies dropped 7.7 percent in November. The $289.6 million monthly drop in sales abroad from the previous month brought exports to $3,456.3 million in November, adjusted for seasonal variation.
In comparison to the same time a year ago, the latest trade numbers show that state exporters posted gains in foreign demand for goods made in Michigan. In November 2010, foreign consumers and businesses bought $305.9 million, or 9.7 percent, more goods made in Michigan than in November 2009.
Looking at exports of manufactures, shipments abroad from state factories decreased 9.0 percent from the previous month to $2,944.7 million, adjusted for seasonal variation.
Manufactured goods accounted for 85 percent of all state exports in November. Compared with 12 months ago, November’s exports from state manufacturing plants were $222.8 million higher. The latest export trends are important for the state’s job market and overall economic development as the industrial mix of foreign sales implies that nearly one in every four factory jobs is tied to exports of manufactures.
Exports of non-manufactured goods totaled $511.6 million in November, a 0.7 percent increase from October. This group of shipments abroad consists of agricultural goods, mining products and re-exports, which is foreign merchandise that enters the state as imports and is exported in substantially the same condition as when imported.
For the country as whole, exports of goods, adjusted for seasonal variation, rose 1.2 percent in November to $113.5 billion, mainly reflecting strong sales in consumer goods; foods, feeds, beverages; capital goods; and industrial supplies and materials.
Looking at export growth, a measure of the strength in global demand for locally made goods and business success of local companies in breaking through to foreign markets, Michigan ranked second among the 50 states in the first 11 months of 2010. So far, Michigan's exports of goods increased 40.0 percent compared to the same period in 2009. For the nation, U.S. exports of goods increased 20.8 percent during the same period.
According to the latest business survey, conducted by the Institute of Supply Management, the nation’s supply executives remained optimistic about the prospects of growing export markets. The Tempe, Ariz.-based research institute reported that its export orders index continued to show growth in new export orders in December for the 18th month in a row.
However, December’s reading implies that the speed of new orders received from abroad was slower than in November. From the pool of respondents of the largest U.S. corporations who sell their products abroad, 21 percent reported greater export orders, 67 percent reported no change in export orders from November’s levels and 12 percent reported smaller export orders.
Evangelos Simos is chief economist of the consulting and research firm e-forecasting.com. He may be reached at email@example.com