Drew Dixon
While the U.S. and China have agreed to slash tariffs, the threat of high trade fees has had a dramatic impact on domestic manufacturing, and the First Coast is no exception.
Northeast Florida manufacturers report there was notable contraction in April for several key factors, according to the results of the latest Jacksonville Economic Monitoring Survey (JEMS) released by the University of North Florida (UNF) Coggin College of Business. The study taps manufacturers on the First Coast to see how their performance measures up on a monthly basis.
April was rough on the Northeast Florida manufacturing scene, as output, new orders, new export orders, backlogs of work, finished goods inventory, employment and the 12-month business activity outlook all showed contraction last month.
“Manufacturers in the area reported holding back orders due to uncertainty and adjusting production downward in response to weakening demand. These trends align with national findings, where both demand and output retreated,” said Albert Loh in a summary of the survey.
Loh is the Interim Dean of the UNF business school and oversees the monthly manufacturing survey. He said a common thread among First Coast manufactures was the specter of increasing trade tariffs that spooked businesses.
“A major theme in both the local and national data is the disruptive impact of tariffs. Jacksonville manufacturers described being ‘squeezed from all sides,’ with rising supplier costs and customers resisting higher prices. This has led to order delays, pricing uncertainty, and increased time spent managing cost models rather than production,” Loh said.
It’s the third month in a row with troubling manufacturing contraction in several sectors on the First Coast. There are some areas that were particularly alarming, according to the UNF findings. New orders fell substantially in April on the heels of an even bigger drop in March.
“In April, Jacksonville’s New Order Index fell to 42 (from an index figure of 47 in March), indicating a significant contraction in the volume of new business orders reported by local firms. A reading below 50 means that relatively more companies are seeing incoming orders dropping compared to the previous month, which is a concerning sign for future production and overall economic activity,” Loh said.
“New orders are a leading indicator of business confidence and demand, so a contraction suggests that businesses in the region are anticipating weaker sales, potentially delaying investment, hiring, or restocking decisions.”
There were a few sectors that moved in a positive direction, but not many. Output prices expanded by 5 index points to 56, and inventory of input purchased expanded by 1 index point to 51, among other modest expansions in input prices and delivery times.
Loh said there is still hope that the First Coast manufacturing picture could improve given the right conditions. But he acknowledged that it’s on shaky ground.
“If global demand stabilizes and trade policy uncertainties ease, Jacksonville could benefit from recovery in multiple areas. However, the overall picture remains fragile, with manufacturers signaling concern over a possible recessionary trend if demand does not recover soon,” Loh said.
