Home Business Manufacturing activity reflects a slight decline at the end of 2021

Manufacturing activity reflects a slight decline at the end of 2021

Actividad manufacturera refleja ligera baja al cierre del 2021

The Monthly Manufacturing Activity Index (IMAM) of the Association of Industries of the Dominican Republic (AIRD) decreased in December compared to November 2021, going from 61.6 to 61.1, despite the fact that it showed an increase in the variables of sales, production and delivery time to suppliers.

This index of industry productivity, measured by the AIRD, stayed above the 50 threshold for all of last year, which reflects that the conditions and perspectives have been favorable to this sector.

"This Index is a portrait of one month’s manufacturing activity relative to the previous one. It is required that when the IMAM is below the threshold of 50 points, it reflects that the economic conditions and perspectives of the manufacturing sector are considered unfavorable. Above 50.0, the outlook is favorable", explains the industrial union in a note sent to the media.

Add the AIRD that The IMAM is presented with an adjustment for seasonality and weighted in its five variables and as a general index, which allows for a more reliable approximation by taking into account the recurring and therefore predictable fluctuations that occur in a period within a year, which tends to affect the measurement of results.

He explains that seasonality can occur in the food harvest seasons, in the Christmas period, in the summer, at the start of school classes, among others. It says that the IMAM, being a monthly indicator, is subject to this seasonality component).

The sample totals 500 companies which have been selected according to their economic importance, sector and geography.

The five variables that are used for the conformation of the IMAN and with which the balance of opinion is established are: the volume of sales, the volume of production, the behavior of employment, the delivery term that suppliers take, and the behavior of the inventories of inputs and raw materials from one month in relation to the other.

As for the variables examined, these were weighted and adjusted for seasonality and when reporting to December in relation to November 2021, we have:

“Sales Volume” went from 58.8 in November to 59.9 in December; “Production Volume” was shown at 53.4 in November and went to 59.5 in December. “Employment” went from 65.4 in November to 62.7 in December. “Inventory of Raw Materials” fell from 64.2 in November to 59.1 in December, and “Supplier Delivery Time” fell from 71.5 in November to 75.6 in December. That is three of the five variables considered showed a downward trend in December compared to November 2021.

 

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