Canada’s manufacturing sector is having a great summer!

The manufacturing sector in Canada is having a banner summer.

The manufacturing sector in Canada is having a banner summer.

The manufacturing sector in Canada is having a banner summer. The RBC Canadian Manufacturing Purchasing Managers' index (PMI) which measure business conditions across the industry, showed the month of August came in at a nine-month high.

A slight rise from July
According to the PMI August numbers swelled slightly to 54.8 – up from 54.3 in July. Numbers above 50 show an expansion from the previous months' figures. Craig Wright is the RBC's economist and he said the numbers confirm what's been seen all summer long.

"The momentum in Canada's manufacturing sector is clearly being sustained," noted Wright. "We expect that Canadian manufacturers will continue to directly benefit from the strengthening U.S. economy, which has made and will continue to make positive strides."

CTV News reported that the survey also showed that more jobs were added through the sector at the strongest pace since last September. The numbers rose, said CTV for the seventh consecutive month.

New orders and output lead the way
The RBC said the spike was sparked by a sharp uptick in output and new orders. According to the report it was the biggest hike since November of 2013. Higher export sales boosted order books and data indicated that fresh orders from overseas rose the most since March. That combined with higher than average domestic spending made for the rising numbers seen in the index.

Production schedules also showed an increase as did a build-up of pre-production stocks. Those numbers also rose for the first time since April. The RBC said that Alberta and British Columbia gained the most in business conditions while Ontario joined the other provinces in the top 3 of new export order growth for the month. Manufacturing employment, said the index, gained in all four regions of the country for the month, as well.

The growth of production was accelerating through August and extended the monthly growth rate to 16 consecutive periods, according to The RBC.

Cheryl Paradowski is the president and chief executive officer of the Supply Chain Management Association and said the numbers are a strong indicator that manufacturing's return is solid.

"August's survey provides an upbeat assessment of the Canadian manufacturing sector" said Paradowski. "Sustained output growth is driving a strong improvement in underlying business confidence, and in turn bolstering manufacturing job creation. There are signs that the resurgent U.S. economy is having an appreciable impact on export sales, as Canadian manufacturers saw one of the fastest rises in new orders from abroad so far this year."

Manufacturing has been a quickly resurgent industrial sector, returning home after years of off-shore outsourcing.