Keywords: Economic Activity, Production, New Orders, Manufacturing, Employment, Backlog of Orders.
The Manufacturing ISM Report On Business is published monthly by the Institute for Supply Management (ISM), the largest supply management organization in the world, as well as one of the most respected. Economic activity in the manufacturing sector expanded in January for the 30th consecutive month, and the overall economy grew for the 32nd consecutive month, say the nation's supply executives in the latest Manufacturing ISM Report On Business.
Manufacturing continued its growth in January as the PMI registered 54.1 percent, an increase of 1 percentage point when compared to December's seasonally adjusted reading of 53.1 percent.
ISM's New Orders Index registered 57.6 percent in January, which is an increase of 2.8 percentage points when compared to the seasonally adjusted December reading of 54.8 percent, and represents a continuation of growth for the 33rd consecutive month.
ISM's Production Index registered 55.7 percent in January, which is a decrease of 3.2 percentage points when compared to the December reading of 58.9 percent (seasonally adjusted). This indicates growth for the 32nd consecutive month.
ISM's Employment Index registered 54.3 percent in January, which is 0.5 percentage point lower than the seasonally adjusted 54.8 percent reported in December. This is the 28th consecutive month of growth in the Employment Index.
The delivery performance of suppliers to manufacturing organizations was slower in January as the Supplier Deliveries Index registered 53.6 percent, which is 2.1 percentage points higher than the seasonally adjusted December reading of 51.5 percent. This is the 31st consecutive month supplier deliveries have slowed relative to the prior month.
The Inventories Index registered 49.5 percent in January, 4 percentage points higher than the 45.5 percent registered in December. The Inventories Index is no longer seasonally adjusted, and therefore the reading reported in December of 47.1 percent was revised to reflect this change.
ISM's Backlog of Orders Index registered 52.5 percent in January, which is 4.5 percentage points higher than the 48 percent reported in December. Of the 80 percent of respondents who reported their backlog of orders, 23 percent reported greater backlogs, 18 percent reported smaller backlogs, and 59 percent reported no change from December.
Of the 18 manufacturing industries, nine are reporting growth in January, in the following order: Apparel, Leather & Allied Products; Petroleum & Coal Products; Machinery; Computer & Electronic Products; Transportation Equipment; Miscellaneous Manufacturing; Fabricated Metal Products; Paper Products; and Primary Metals. The seven industries reporting contraction in January — listed in order — are: Plastics & Rubber Products; Furniture & Related Products; Wood Products; Chemical Products; Food, Beverage & Tobacco Products; Electrical Equipment, Appliances & Components; and Textile Mills.
ARC Advisory Group