ISM: Manufacturing Contracts For 7th Consecutive Month
“The Production Index reading of 51.1 percent is a 2.2-percentage point increase compared to April's figure of 48.9 percent. The Prices Index registered 44.2 percent, down 9 percentage points compared to the April figure of 53.2 percent. The Backlog of Orders Index registered 37.5 percent, 5.6 percentage points lower than the April reading of 43.1 percent. “The Employment Index indicated another month of ex- pansion, registering 51.4 percent, up 1.2 percentage points from April's reading of 50.2 percent. The Supplier Deliv- eries Index figure of 43.5 percent is 1.1 percentage points lower than the 44.6 percent recorded in April; this is the index's lowest reading since March 2009 (43.2 percent). “The Inventories Index dropped 0.5 percentage point to 45.8 percent; the April reading was 46.3 percent. The New Export Orders Index reading of 50 percent is 0.2 per- centage point higher than April's figure of 49.8 percent The Imports Index remained in contraction territory, reg-
The Institute for Supply Management announced that economic activity in the manufacturing sector contract- ed in May for the seventh consecutive month following a 28-month period of growth, say the nation's supply execu- tives in the latest Manufacturing ISM Report On Business. The report was issued on June 1 by Timothy R. Fiore, CPSM, C.P.M., Chair of the Institute for Supply Management: “The May Manufacturing PMI registered 46.9 percent, 0.2 percentage point lower than the 47.1 percent recorded in April. Regarding the overall economy, this figure indi- cates a sixth month of contraction after a 30-month period of expansion. The New Orders Index remained in contrac- tion territory at 42.6 percent, 3.1 percentage points lower than the figure of 45.7 percent recorded in April.
istering 47.3 percent, 2.6 percentage points lower the 49.9 percent reported in April. “The U.S. manufacturing sector shrank again, with the Manufacturing PMI losing a bit of ground compared to the previous month, indicating a faster rate of contraction. The May composite index reading reflects companies continuing to manage outputs to better match demand for the first half of 2023 and prepare for growth in the late summer/early fall period. However, there is clearly more business uncertainty in May. “Demand eased again, with the (1) New Orders Index contracting at a faster rate, (2) New Export Orders Index slightly improving to 50 percent, (3) Customers' Inventories In- dex persisting at the low end of 'too high' territory, a negative for future production and (4) Backlog of Orders Index dropping to a level not seen since the Great Recession. “Output/Consumption (measured by the Production and Employment indexes) was positive, with a combined 3.4-percentage point upward impact on the Manufacturing PMI calculation. “The Employment Index expanded for the second month (and at a faster rate) af- ter two months of contraction, and the Pro- duction Index moved back into expansion territory. Regarding employment, panelists' comments continue to indicate near equal levels of activity toward expanding and con- tracting head counts at their companies, amid mixed sentiment about when signifi- cant growth will return. Inputs — defined as supplier deliveries, inventories, prices and imports — continue to accommodate future demand growth.” Visit www.ismworld.org for more.
10 June 12, 2023
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