A monthly University of North Florida survey of Jacksonville area manufacturers found a continued slight contraction in activity in April, while optimism about the next 12 months eroded.
The survey by UNF’s Local Economic Indicators Project produced a Purchasing Manager’s Index of 49 in April for the second straight month. A PMI below 50 indicates contraction in the economy while an index above 50 would indicate expansion.
Meanwhile, the survey’s Business Activity Outlook Index dropped to 42, from 44 in March, indicating manufacturers are becoming more pessimistic about the next 12 months.
Other components of the survey, including the output index, new orders and employment, were all in contraction territory, reflecting broad-based weakness in the Northeast Florida economy, said UNF economist Albert Loh.
“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,” Loh said in his monthly report on the survey.
“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,” he said.
Loh said the uncertainty “has clearly eroded confidence, with one respondent noting, ‘everyone’s nervous,’ and another emphasizing that ‘inflation from tariffs is real,’ suggesting that the pressure is not just theoretical but directly impacting margins and decision-making.”
The survey’s employment index fell to 45 in April, as manufacturing jobs decline in the Jacksonville area.
“This decline suggests that firms are responding to ongoing economic uncertainty, weak demand, and cost pressures by slowing hiring or actively reducing staff,” Loh said.
The response from manufacturers in the survey is in line with monthly labor market data from the Florida Department of Commerce, which has shown manufacturing is one of the few large industry sectors losing jobs in the Jacksonville area.
The agency is scheduled to release its April jobs report May 16.
“If global demand stabilizes and trade policy uncertainties ease, Jacksonville could benefit from recovery in multiple areas,” Loh said.
“However, the overall picture remains fragile, with manufacturers signaling concern over a possible recessionary trend if demand does not recover soon.”