Georgia International Business Index declines for fourth quarter of 2013
Fourth-quarter drop reverses third-quarter gains in state’s international manufacturing activity
KENNESAW, Ga. (Jan. 23, 2014) — Georgia international manufacturing experienced a decline in activity during the fourth quarter of 2013 according to the Georgia International Business Index (GIBI), a quarterly survey released today by Kennesaw State University’s Econometric Center in the Michael J. Coles College of Business.
The fourth-quarter GIBI dropped by 14.8 points from 70.5 in the third quarter to 55.8. According to the report, this decrease is largely due to weaknesses in new orders, production and capital spending. Employment was the only component to increase by 4.9 points.
“The GIBI experienced extreme volatility as it reversed its gains from the third quarter,” said Don Sabbarese, professor of economics and director of the Econometric Center at Kennesaw State. “The employment increase, combined with weaknesses in other components, suggests that respondents remain confident that future new order and production will remain at a sustainable level of future growth.”
Highlights from the fourth-quarter GIBI include:
- New orders down 32.4 points, to 46.2
- Production down 21.2 points, to 53.8
- Employment up 4.9 points, to 69.2
- Capital spending down 10.4 points, to 53.8
- Exports as a percent of total sales is down 0.2 of a point, to 12.4
- Imports as a percent of total sales is up 7.2 points, to 47.8
The Georgia International Business Index provides a quarterly snapshot of manufacturing activity for foreign-funded businesses in the state. The survey is a composite of four components — new orders, production, employment and capital spending. A GIBI reading above 50 indicates that manufacturing activity is expanding; a reading below 50 indicates it is contracting.
The GIBI, compiled from a quarterly survey of manufacturers, is the only indicator of market conditions for foreign-funded manufacturers. Manufacturing, which accounts for 9 percent of total employment, is sensitive to changes in the economy and trends in manufacturing, and reveals differences between domestic and foreign-funded manufacturers.
The GIBI’s value is in its timeliness and sensitivity to variables such as interest rates, global markets and other economic changes. The Georgia International Business Index provides valuable data used by businesses and government agencies to assist in its analysis of current economic conditions, along with many other data sources, to get a picture of economic activity.
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Kennesaw State University is the third-largest university in Georgia, offering 90 graduate and undergraduate degrees, including doctorates in education, business and nursing and a Ph.D. in international conflict management. A member of the University System of Georgia, Kennesaw State is a comprehensive, residential institution with a growing student population of more than 24,600 from 130 countries.