According to the July 2017 Manufacturing ISM Report On Business, New Orders, Production, Backlog of Orders, and Employment Continue Growing

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 July, and the overall economy grew for the 98th consecutive month, say the nation's supply executives in the latest Manufacturing ISM Report On Business.

Manufacturing expanded in July as the PMI registered 56.3 percent, a decrease of 1.5 percentage points from the June reading of 57.8 percent. This indicates growth in manufacturing for the 11th consecutive month and is the fourth highest reading in the last 12 months.

ISM's New Orders Index registered 60.4 percent in July, which is a decrease of 3.1 percentage points when compared to the 63.5 percent reported for June, indicating growth in new orders for the 11th consecutive month.

ISM's Production Index registered 60.6 percent in July, which is a decrease of 1.8 percentage points when compared to the 62.4 percent reported for June, indicating growth in production for the 11th consecutive month.

ISM's Employment Index registered 55.2 percent in July, a decrease of 2 percentage points when compared to the June reading of 57.2 percent. This indicates growth in employment in July for the 10th consecutive month. Employment levels have been expanding since October 2016.

The delivery performance of suppliers to manufacturing organizations was slower in July, as the Supplier Deliveries Index registered 55.4 percent. This is 1.6 percentage points lower than the 57 percent reported for June. This is the 15th straight month of slowing supplier deliveries.

The Inventories Index registered 50 percent in July, which is an increase of 1 percentage point when compared to the 49 percent reported for June, indicating raw materials inventories saw no change in July compared to June.

ISM's Backlog of Orders Index registered 55 percent in July, a decrease of 2 percentage points from the 57 percent reported for June, indicating growth in order backlogs for the sixth consecutive month. Of the 88 percent of respondents who reported their backlog of orders, 25 percent reported greater backlogs, 15 percent reported smaller backlogs, and 60 percent reported no change from June.

Of the 18 manufacturing industries, 15 reported growth in July in the following order: Plastics & Rubber Products; Electrical Equipment, Appliances & Components; Wood Products; Fabricated Metal Products; Machinery; Chemical Products; Paper Products; Food, Beverage & Tobacco Products; Printing & Related Support Activities; Computer & Electronic Products; Nonmetallic Mineral Products; Furniture & Related Products; Miscellaneous Manufacturing; Primary Metals; and Transportation Equipment. Three industries reported contraction in July compared to June: Apparel, Leather & Allied Products; Textile Mills; and Petroleum & Coal Product.

Keywords: Automation, Manufacturing, Process Industries, Discrete Industries, Supply Management, PMI, ISM, ARC Advisory Group.