Manufacturing industry continues to struggle

June 4th, 2014

Manufacturing firms continue to face difficulties Manufacturing firms continue to face difficulties

The manufacturing industry continued to struggle last month, which analysts believe is the result of measures announced in the federal budget.

Chief Executive of the Australian Industry Group Innes Willox said the impact of the federal budget is weighing heavily on consumer and business sentiment at the moment - and manufacturers are not immune.

The Australian Industry Group Australian Performance of Manufacturing Index for May registered a mild increase of 4.4 points to reach 49.2. A reading of 50 usually marks the point of expansion.

New order and manufacturing production increased during the month, with these sub-indexes seeing their index readings improve to 51.6 points and 55.1 points, respectively.

However, these increases were not substantial enough to counteract the declines in employment, supplier deliveries, exports and inventories witnessed during the month.

Mr Willox commented: "The manufacturing sector continues to be buffeted by weak household demand, a lack of business confidence and fierce competition in both domestic and export markets heightened by the renewed strength in the Australian dollar."

Further results show four sub-sectors expanded out of the eight taken into consideration. The relatively small wood and paper products industry recorded the highest reading of 55.5.

Meanwhile, the printing and recorded media sub-sector posted the weakest result of 37.3 points in May.

Firms in the sector could find benefits from a debtor finance company, which can help them cope with times when cash flow might not be as strong as they would like.

Unpaid invoices are assigned to the debtor finance company, meaning you can receive 80 per cent of their balance without delay, helping your business stay afloat even during the most difficult times.

CashFlow Advantage can provide this fast and convenient solution to your cash flow issues no matter what industry you're operating in.

If you'd like to learn how Earlypay's Invoice Finance & Equipment Finance can help you boost your working capital to fund growth or keep on top of day-to-day operations of your business, contact Earlypay's helpful team today on 1300 760 205, visit our sign-up form or contact [email protected].