The July 31 Smith Leonard survey of residential furniture manufacturers and distributors found new orders in May rose 3% over orders in May 2013, following a 13% increase in April.
“While housing growth has slowed somewhat, this part of the economy still seems somewhat healthy,” said Ken Smith, managing partner of the accounting and consulting firm. “We need more new houses to be built to keep inventories at good levels, but overall housing seems to be helping.”
About 53% of the participants reported increased orders for May over May 2013, down from 77% reporting increases in June. Year-to-date new orders remained 5% ahead of the same period a year ago.
Shipments and backlog shipments in May 2014 were 5% higher than May 2013 and up 3% over April. Some 61% of participants reported shipments up over May 2013, down from April’s 85%.
Year-to-date, shipments remained 6% higher than the same period a year ago. Shipments were up for about 67% of the participants, up slightly from 65% in April. Backlogs remained 13% ahead of last May dropping 1% from April, “but remained at pretty strong levels,” the company said.
Receivables and inventories receivable levels were up 9% over May 2013 and up 2% from April. The firm said the 9% increase over last year seemed a bit high.
But last month, shipments were up 12% over the prior year and receivables up 14%. Inventories increased 2% over April, making inventory levels 7% higher than May 2013. The firm also said that “while maybe a bit high, they do not appear too far out of line based on current order and shipment rates.”
Factory and warehouse employee numbers held steady, reflecting a 5% increase. “This increase appears in line with current business conditions,” Smith Leonard said.
Factory and warehouse payrolls increased 2% over May 2013 but fell 1% from April. Factory and warehouse payrolls year-to-date were 6% higher and down slightly from 7% reported last month.