The Chicago Business Barometer from ISM-Chicago and Deutsche Börse rose from 50.0 in December to 55.6 in January. In essence, this suggests that manufacturing activity in the Midwest shifted from being relatively flat over much of the past four months to modest growth as we start 2013.

The pace seen in December is the fastest experienced since April. This follows data from the Federal Reserve Bank of Chicago that said that production picked up as we ended 2012, particularly in the motor vehicle sector.

Stronger sales and production data were behind the higher Barometer figure in January. The index of new orders rose from 50.4 to 58.2, and the production measure increased from 52.4 to 60.9. The other bit of good news is on the hiring front. The employment index shifted from a contraction in December (46.8) to growth in January (58.0), with the latest figure the highest since June. Capital equipment purchases also improved over last month’s average.

In contrast to these more-positive figures, the backlog of orders continues to decline. The order backlog index improved slightly from 45.1 to 46.6, but is still below the threshold of 50 which would indicate growth. Likewise, supplier deliveries were essentially unchanged, falling from 52.8 to 49.9 (or just barely contractionary).

Chad Moutray is chief economist, National Association of Manufacturers.

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