The Institute for Supply Management’s PMI Index* hit 51.6% last month, reflecting an expansion in manufacturing activity. More importantly, the rise in the index in September shows the overall economy grew—albeit in small increments—for the 28th consecutive month.
Of the 18 manufacturing industries covered, 12 reported growth in September, in the following order: Wood Products; Petroleum & Coal Products; Food, Beverage & Tobacco Products; Apparel, Leather & Allied Products; Nonmetallic Mineral Products; Machinery; Miscellaneous Manufacturing; Transportation Equipment; Plastics & Rubber Products; Printing & Related Support Activities; Chemical Products; and Computer & Electronic Products.
The six industries that experienced contraction in September—listed in order—are: Primary Metals; Textile Mills; Furniture & Related Products; Fabricated Metal Products; Paper Products; and Electrical Equipment, Appliances & Components.
With respect to new orders, activity was much slower. The Institute for Supply Management’s New Orders Index registered 49.6 percent in September—essentially the same rate as August. In fact, September marks the third consecutive month of contraction in the New Orders Index, following 24 months of growth.
According to Bradley J. Holcomb, CPSM, CPSD, chair of the Institute for Supply Management Manufacturing Business Survey Committee, there is still some trepidation in the marketplace. “Comments from respondents generally reflect concern over the sluggish economy, political and policy uncertainty in Washington, and forecasts of ongoing high unemployment that will continue to put pressure on demand for manufactured products,” he said.
The complete September PMI Index Report—including historical charts and tables—is available online.
*A reading above 50 percent indicates that the manufacturing economy is generally expanding; below 50 percent indicates that it is generally contracting.