Economic activity in the manufacturing sector contracted in May for the second consecutive month, according to the latest Manufacturing ISM Report on Business.
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The Manufacturing PMIâ registered 48.7% in May, down 0.5 percentage points from the 49.2% recorded in April.
The overall economy continued in expansion for the 49th 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 remained in contraction territory, registering 45.4%, 3.7 percentage points lower than the 49.1% recorded in April.
- The May reading of the Production Index (50.2%) is 1.1 percentage points lower than April’s figure of 51.3%.
- The Prices Index registered 57%, down 3.9 percentage points compared to the reading of 60.9% in April.
- The Backlog of Orders Index registered 42.4%, down 3 percentage points compared to the 45.4%recorded in April.
- The Employment Index registered 51.1%, up 2.5 percentage points from April’s figure of 48.6%.
- The Supplier Deliveries Index figure of 48.9% equaled the reading recorded in April. (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 registered 47.9%, down 0.3 percentage point compared to April’s reading of 48.2%.
- The New Export Orders Index reading of 50.6% is 1.9 percentage points higher than the 48.7% registered in April.
- The Imports Index continued in expansion territory, registering 51.1%, 0.8 percentage point lower than the 51.9% reported in April. During its current five-month streak in expansion, the Imports Index has averaged 51.8%.
The seven manufacturing industries reporting growth in May — in order — are: Printing & Related Support Activities; Petroleum & Coal Products; Paper Products; Textile Mills; Primary Metals; Fabricated Metal Products; and Chemical Products.
