July 2022 Manufacturing ISM Report On Business Has the Production Index Indicating Growth for the 26th Consecutive Month

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 grew in July, with the overall economy achieving a 26th consecutive month of growth, say the nation's supply executives in the latest Manufacturing ISM Report On Business®.

The U.S. manufacturing sector grew in July, as the Manufacturing PMI registered 52.8 percent, 0.2 percentage point lower than the June reading of 53 percent. The Manufacturing PMI continued to indicate sector expansion and U.S. economic growth in July.

ISM’s New Orders Index dropped to 48 percent in July, a decrease of 1.2 percentage points compared to the 49.2 percent reported in June. This indicates that new order volumes contracted again after growing for 24 consecutive months.

The Production Index registered 53.5 percent in July, 1.4 percentage points lower than the June reading of 54.9 percent, indicating growth for the 26th consecutive month.

ISM’s Employment Index registered 49.9 percent in July, 2.6 percentage points above the June reading of 47.3 percent. The index contracted for the third straight month after an eight-month period of expansion.

The delivery performance of suppliers to manufacturing organizations was slower in July, as the Supplier Deliveries Index registered 55.2 percent, 2.1 percentage points lower than the 57.3 percent reported in June.

The Inventories Index registered 57.3 percent in July, 1.3 percentage points higher than the 56 percent reported for June. Manufacturing inventories expanded at a faster rate compared to June, registering their highest level since July 1984, when the index registered 57.8 percent.

ISM’s Backlog of Orders Index registered 51.3 percent in July, a 1.9-percentage point decrease compared to the 53.2 percent reported in June, indicating order backlogs expanded for the 25th straight month.

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