Economic activity in the manufacturing sector contracted in January for the 15th consecutive month, according to the latest Manufacturing ISM Report on Business.
Don’t miss any content from Distribution Strategy Group. Join our list.
The report was issued today by Timothy R. Fiore, CPSM, C.P.M., Chair of the Institute for Supply Management® (ISM®) Manufacturing Business Survey Committee.
The Manufacturing PMI® registered 49.1% in January, up 2 percentage points from the seasonally adjusted 47.1% recorded in December.
The overall economy continued in expansion for the 45th month after one month of contraction in April 2020. (A Manufacturing PMI® above 42.5%, over a period of time, generally indicates an expansion of the overall economy.)
- The New Orders Index moved into expansion territory at 52.5%, 5.5 percentage points higher than the seasonally adjusted figure of 47% recorded in December.
- The January reading of the Production Index (50.4%) is 0.5 percentage point higher than December’s seasonally adjusted figure of 49.9 percent.
- The Prices Index registered 52.9%, up 7.7 percentage points compared to the reading of 45.2% in December.
- The Backlog of Orders Index registered 44.7%, 0.6 percentage point lower than the 45.3% recorded in December.
- The Employment Index registered 47.1%, down 0.4 percentage point from December’s seasonally adjusted figure of 47.5 percent.
- The Supplier Deliveries Index figure of 49.1% is 2.1 percentage points higher than the 47% recorded in December. (Supplier Deliveries is the only ISM® Report On Business® index that is inversed; a reading of above 50% indicates slower deliveries, which is typical as the economy improves and customer demand increases.)
- The Inventories Index increased 2.3 percentage points to 46.2% from December’s seasonally adjusted reading of 43.9 percent.
- The New Export Orders Index reading of 45.2% is 4.7 percentage points lower than December’s figure of 49.9 percent.
- The Imports Index moved into expansion territory, registering 50.1%, 3.7 percentage points higher than the 46.4% reported in December.
The four manufacturing industries reporting growth in January are: Apparel, Leather & Allied Products; Textile Mills; Transportation Equipment; and Chemical Products.
The 13 industries reporting contraction in January — in the following order — are: Wood Products; Machinery; Plastics & Rubber Products; Nonmetallic Mineral Products; Furniture & Related Products; Computer & Electronic Products; Fabricated Metal Products; Petroleum & Coal Products; Food, Beverage & Tobacco Products; Electrical Equipment, Appliances & Components; Paper Products; Miscellaneous Manufacturing; and Primary Metals.
