Manufacturing orders up, but so are prices. And jobs are still going down

More data showing that economic growth continued in March, as orders and shipments in manufacturing kept increasing.

New orders for manufactured goods in March, up four of the last five months, increased $9.1 billion or 1.5 percent to $630.4 billion, the U.S. Census Bureau reported today. This followed a 0.3 percent February increase. Shipments, up five of the last six months, increased $8.8 billion or 1.4 percent to $633.9 billion. This followed a 1.7 percent February increase. Unfilled orders, up twenty of the last twenty-one months, increased $1.6 billion or 0.1 percent to $1,540.9 billion. This followed a 0.1 percent February increase. The unfilled orders-to-shipments ratio was 6.88, down from 6.92 in February. Inventories, up six consecutive months, increased $5.8 billion or 0.6 percent to $956.3 billion. This followed a 0.1 percent February increase. The inventories-to-shipments ratio was 1.51, down from 1.52 in February.

New orders for manufactured durable goods in March, up following three consecutive monthly decreases, increased $2.7 billion or 0.8 percent to $318.9 billion, unchanged from the previously published increase. This followed a 1.2 percent February decrease. Computers and electronic products, up eleven of the last twelve months, led the increase, $1.0 billion or 3.6 percent to $29.6 billion. New orders for manufactured nondurable goods increased $6.5 billion or 2.1 percent to $311.5 billion.

Shipments of manufactured durable goods in March, up six of the last seven months, increased $2.4 billion or 0.7 percent to $322.4 billion, unchanged from the previously published increase. This followed a 1.6 percent February increase. Machinery, up four of the last five months, led the increase, $0.9 billion or 2.3 percent to $41.6 billion. Shipments of manufactured nondurable goods, up four consecutive months, increased $6.5 billion or 2.1 percent to $311.5 billion. This followed a 1.9 percent February increase. Petroleum and coal products, up three consecutive months, led the increase, $5.6 billion or 9.9 percent to $62.1 billion.

Which indicates that manufacturing was still going strong at the end of Q1 2026, at least on the demand for products.

And last week, the latest ISM Manufacturing report said that growth of output kept going into April.

The report was issued today by Susan Spence, MBA, Chair of the Institute for Supply Management® (ISM®) Manufacturing Business Survey Committee.

“The Manufacturing PMI® registered 52.7 percent in April, the same reading as March. The overall economy continued in expansion for the 18th month in a row. (A Manufacturing PMI® above 47.5 percent, over a period of time, generally indicates an expansion of the overall economy.) The New Orders Index expanded for the fourth straight month after four straight readings in contraction, registering 54.1 percent, up 0.6 percentage point compared to March’s figure of 53.5 percent. The April reading of the Production Index (53.4 percent) is 1.7 percentage points lower than March’s reading of 55.1 percent. The Prices Index remained in expansion (or ‘increasing’ territory), registering 84.6 percent, a 6.3-percentage point jump from March’s reading of 78.3 percent. In the last three months, the Prices Index has increased 25.6 percentage points to reach its highest level since April 2022 (84.6 percent). The Backlog of Orders Index registered 51.4 percent, down 3 percentage points compared to the 54.4 percent recorded in March. The Employment Index registered 46.4 percent, down 2.3 percentage points from March’s figure of 48.7 percent,” says Spence….

Spence continues, “In April, U.S. manufacturing activity remained in expansion territory, growing at the same pace as the month before. Of the five subindexes that make up the PMI®, the New Orders and Supplier Deliveries indexes indicated faster growth compared to the previous month, the Production Index grew at a slower rate, and the Employment and Inventories indexes remained in contraction.

But did you notice that “prices paid” part? A number over 50 would indicate prices went above the previous month’s level. But 84.6% is a whole different level, back to the days of Spring 2022, which had the highest price increases in over 40 years. And the ISM report says the higher prices are happening in every industry of the sector.

So if prices are jumping by so much, is a 1.5% increase in the cost of new orders for March or a 1.4% increase in the cost of shipments all that impressive? And looking inside the ISM numbers, you can see evidence of more job losses in April and the prospect of slower overseas business along with those higher costs and prices.

Increased production with lower employment can only be possible with higher increases in productivity. But that's supposed to bring prices per unit down , and instead prices are going up at their highest amounts in 4 years...and 40+ years.

This is a recipe for higher profits for manufacturers on top of what was already back near record levels in the industry at the end of 2025.

Hey lookie there - profits are back at the peaks of the "inflation" times of 2022! What a coincidence!

Let's see if my instinct is right, where these higher prices lead to record profits for businesses, while everyday workers pay. And when do the increased orders and demands stop when no one can afford the combination of higher prices and lower wages and fewer jobs.