Manufacturing all around the world has taken a hit due to Covid-19, and the U.S. is no exception. Many companies in the U.S. have been dealing with supply chain disruptions, factory closures, and a lack of demand due to the effects of Covid-19. However, new data shows that the manufacturing sector is starting to rebound.
According to new information released by the Commerce Department, orders for durable goods rose by 11.2% in July. Durable goods are items that are meant to last for three or more years after being purchased. This rise comes after a 7.7% jump in June and is more than double what economists were expecting, as they had anticipated a 4.8% increase for the month.
The new information now shows that durable good orders have been rising for three straight months. While orders remain below pre-pandemic levels, they do indicate that the manufacturing sector is continuing its V-shaped recovery at a quite fast pace. Still, the underlying gauge of business decelerated, indicating companies are still hesitant to invest due to high unemployment and rising COVID cases.
Much of July’s surge has been due to the recent production boosts in the auto manufacturing field. Order for vehicles and vehicle parts jumped by 21.9% in July. This comes after the massive surge of 81.6% in June. Excluding auto manufacturing, other durable goods orders only rose by 2.4% in July.
One field which did not see any positive increase was the civilian aircraft market. Due to the lack of air travel demand caused by Covid-19, orders for civilian aircraft and parts were negative for a second month, hitting minus $5.8 billion in July. In June, the field was at minus $10.8 billion. Chief U.S. plane producer Boeing reported zero new orders for June and just one new order for July.