Manufacturing Activity Up in September- ISM PMI Report

Economic activity in the manufacturing sector expanded in September following one month of contraction in August, and the overall economy grew for the 88th consecutive month” according to the latest Institute for Supply Management Purchasing Manager’s Index Report. September ISM PMI

Up 2.1 percent points and indicates economic growth for Manufacturing sector at 51.5

Up 2.1 percent points and indicates economic growth for Manufacturing sector at 51.5

Our look this month at the ISM PMI release for September is positive for our precision machining shops, for manufacturing, and for the broader US Economy.

  • The ISM’s New Order Index increase of 6 percentage points bodes well for our shops going forward.
  • The increase in the PMI back to expansion for manufacturing is a positive, 
  • This is the 88th consecutive month of expansion in the broader economy according to this report.

 

According to Bradley J. Holcomb, CPSM, CPSD, chair of the Institute for Supply Management® (ISM®) Manufacturing Business Survey Committee:

“The September PMI® registered 51.5 percent, an increase of 2.1 percentage points from the August reading of 49.4 percent. The New Orders Index registered 55.1 percent, an increase of 6 percentage points from the August reading of 49.1 percent. The Production Index registered 52.8 percent, 3.2 percentage points higher than the August reading of 49.6 percent. The Employment Index registered 49.7 percent, an increase of 1.4 percentage points from the August reading of 48.3 percent. “

The increase of 2.1 percentage points  in the ISM PMI over August beat analyst’s expectations of 50.3 and shows manufacturing back in expansion mode. In a Wall Street Journal poll,  published prior to the ISM release, economists estimated that the ISM reading would increase to 49.7 from 49.4 the month before- showing manufacturing still in contraction mode.

We’re glad the data beat the estimates!

Our shops have been seeing extreme volatility in sales as reported in our PMPA Business Trends Report for August. this September report is positive for precision machining.

 

Chart courtesy Calculated Risk Blog

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