ISM: Manufacturing index rises in November

Growth pace accelerates to highest level since June

12/09/2011


Economic activity in the manufacturing sector expanded in November for the 28th consecutive month, and the overall economy grew for the 30th consecutive month, say the nation's supply executives in the latest Manufacturing ISM Report On Business.

The report was issued today by Bradley J. Holcomb, chair of the Institute for Supply Management Manufacturing Business Survey Committee. “The PMI registered 52.7% an increase of 1.9 percentage points from October's reading of 50.8% indicating expansion in the manufacturing sector for the 28th consecutive month,” Holcomb said. “The New Orders Index increased 4.3 percentage points from October to 56.7% reflecting the second month of growth after three months of contraction.

“While the Prices Index, at 45% increased 4 percentage points from the October reading of 41% prices of raw materials continued to decrease (registering below 50%) for the second consecutive month. Respondents cite continuing concerns about the general economic environment, government regulations and European financial conditions, but are cautiously more optimistic about the next few months based on lower raw materials pricing and favorable levels of new orders.”

What respondents are saying...

  • “Business still holding its own. Some growth in margin now that some of the raw materials prices have abated. Oil is pushing $100 so that has not been favorable.”
  • “Orders for the remaining two months have increased after an extended 'summer dip' in sales overall. We expect to finish the year approximately 10% above 2010.”
  • “Seeing a slight slowdown in orders; could be related to the holidays.”
  • “Material lead times are getting longer. Seems like no one is hiring. Trying to do twice the output with the same amount of people.”
  • “Japanese auto production has returned to 100% and domestic manufacturing continues to increase.”
  • “Oil exploration seems to be really picking up. Government is permitting again, so business is the busiest we've ever seen.”
  • “The EPS ruling about higher fees for coal-generated electricity can have a huge, negative impact on our business if implemented in January 2012. We are at the peak of our seasonal demand push.”
  • “Thailand flood impacting our business. Honda and Toyota cut production forecasts, and we are chasing some components made in Thailand.”

Manufacturing continued its growth in November as the PMI registered 52.7% an increase of 1.9 percentage points when compared to October's reading of 50.8%. A reading above 50% indicates that the manufacturing economy is generally expanding; below 50% indicates that it is generally contracting.

A PMI in excess of 42.5% over a period of time, generally indicates an expansion of the overall economy. Therefore, the PMI indicates growth for the 30th consecutive month in the overall economy, as well as expansion in the manufacturing sector for the 28th consecutive month.

“The past relationship between the PMI and the overall economy indicates that the average PMI for January through November (55.4%) corresponds to a 4.5% increase in real gross domestic product,” said Holcomb. “In addition, if the PMI for November (52.7%) is annualized, it corresponds to a 3.6% increase in real GDP annually.”

The last 12 months

Read the rest of the report here.

Institute for Supply Management

www.ism.ws



No comments
The Engineers' Choice Awards highlight some of the best new control, instrumentation and automation products as chosen by...
Each year, a panel of Control Engineering editors and industry expert judges select the System Integrator of the Year Award winners.
Control Engineering Leaders Under 40 identifies and gives recognition to young engineers who...
Learn more about methods used to ensure that the integration between the safety system and the process control...
Adding industrial toughness and reliability to Ethernet eGuide
Technological advances like multiple-in-multiple-out (MIMO) transmitting and receiving
Virtualization advice: 4 ways splitting servers can help manufacturing; Efficient motion controls; Fill the brain drain; Learn from the HART Plant of the Year
Two sides to process safety: Combining human and technical factors in your program; Preparing HMI graphics for migrations; Mechatronics and safety; Engineers' Choice Awards
Detecting security breaches: Forensic invenstigations depend on knowing your networks inside and out; Wireless workers; Opening robotic control; Product exclusive: Robust encoders
The Ask Control Engineering blog covers all aspects of automation, including motors, drives, sensors, motion control, machine control, and embedded systems.
Join this ongoing discussion of machine guarding topics, including solutions assessments, regulatory compliance, gap analysis...
News and comments from Control Engineering process industries editor, Peter Welander.
IMS Research, recently acquired by IHS Inc., is a leading independent supplier of market research and consultancy to the global electronics industry.
This is a blog from the trenches – written by engineers who are implementing and upgrading control systems every day across every industry.
Anthony Baker is a fictitious aggregation of experts from Callisto Integration, providing manufacturing consulting and systems integration.
Integrator Guide

Integrator Guide

Search the online Automation Integrator Guide
 

Create New Listing

Visit the System Integrators page to view past winners of Control Engineering's System Integrator of the Year Award and learn how to enter the competition. You will also find more information on system integrators and Control System Integrators Association.

Case Study Database

Case Study Database

Get more exposure for your case study by uploading it to the Control Engineering case study database, where end-users can identify relevant solutions and explore what the experts are doing to effectively implement a variety of technology and productivity related projects.

These case studies provide examples of how knowledgeable solution providers have used technology, processes and people to create effective and successful implementations in real-world situations. Case studies can be completed by filling out a simple online form where you can outline the project title, abstract, and full story in 1500 words or less; upload photos, videos and a logo.

Click here to visit the Case Study Database and upload your case study.