Manufacturing contracts in November, ISM reports

Economic uncertainty blunts two straight months of growth


Institute of Supply Management logo. Courtesy: ISMAfter two months of growth, the manufacturing sector contracted slightly in November, as the Institute for Supply Management’s PMI Index fell to 49.5%, just under the 50% threshold for growth.

The PMI had registered above 51% in September and October, reversing a dip below 50% in the summer. Economists with the ISM said economic uncertainty both in the U.S. and global contributed to the decline.

“Comments from the panel this month generally indicate that the second half of the year continues to show a slowdown in demand; respondents also express concern over how and when the fiscal cliff issue will be resolved," said Bradley J. Holcomb, CPSM, CPSD, chair of the Institute for Supply Management’s Manufacturing Business Survey Committee. “The PMI registered 49.5%, a decrease of 2.2 percentage points from October's reading of 51.7%, indicating contraction in manufacturing for the fourth time in the last six months. This month's PMI reading reflects the lowest level since July 2009 when the PMI registered 49.2%.

While the Production Index registered 53.7%, indicating growth in production for the second consecutive month, the Employment Index registered 48.4%, a decrease of 3.7 percentage points, which is the index's lowest reading since September 2009 when the Employment Index registered 47.8 %.

One respondent told the survey committee, “Business is steady, but not much more than that. We are in a lull." Another commented, “The principle business conditions that will affect the company over the next three or four quarters will be the U.S. federal government tax and budgetary policies; the impact of those policies is not yet clear.”

Since the PMI was above 42.6%, which is the threshold for overall economic growth, November marked the 42nd consecutive month of growth, according to the PMI Index. “The past relationship between the PMI and the overall economy indicates that the average PMI for January through November (51.8%) corresponds to a 3.1% increase in real gross domestic product,” Holcomb said. “In addition, if the PMI for November (49.5%) is annualized, it corresponds to a 2.3% increase in real GDP annually."












Nov 2012






May 2012




Oct 2012






Apr 2012




Sep 2012






Mar 2012




Aug 2012






Feb 2012




Jul 2012






Jan 2012




Jun 2012






Dec 2011




Average for 12 months – 51.9
High – 54.8
Low – 49.5


, WA, United States, 12/13/12 03:03 PM:

As the world economy is uncertain, supply and demand is more criticle. The fact that China is seeing fluctuations in their low tech. mfg. markets is cause for concern. As the west retools with high end Mfg. technology we are seeing more company profits returning. We need more IP, better qualified H.S. grads & opportunities for Skills experiance.
The Engineers' Choice Awards highlight some of the best new control, instrumentation and automation products as chosen by...
The System Integrator Giants program lists the top 100 system integrators among companies listed in CFE Media's Global System Integrator Database.
The Engineering Leaders Under 40 program identifies and gives recognition to young engineers who...
This eGuide illustrates solutions, applications and benefits of machine vision systems.
Learn how to increase device reliability in harsh environments and decrease unplanned system downtime.
This eGuide contains a series of articles and videos that considers theoretical and practical; immediate needs and a look into the future.
Choosing controllers: PLCs, PACs, IPCs, DCS? What's best for your application?; Wireless trends; Design, integration; Manufacturing Day; Product Exclusive
Variable speed drives: Smooth, efficient, electrically quite motion control; Process control upgrades; Mobile intelligence; Product finalists: Vote now; Product Exclusives
Machine design tips: Pneumatic or electric; Software upgrades; Ethernet advantages; Additive manufacturing; Engineering Leaders; Product exclusives: PLC, HMI, IO
This article collection contains the 5 most referenced articles on improving the use of PID.
Learn how Industry 4.0 adds supply chain efficiency, optimizes pricing, improves quality, and more.

Find and connect with the most suitable service provider for your unique application. Start searching the Global System Integrator Database Now!

Cyber security cost-efficient for industrial control systems; Extracting full value from operational data; Managing cyber security risks
Drilling for Big Data: Managing the flow of information; Big data drilldown series: Challenge and opportunity; OT to IT: Creating a circle of improvement; Industry loses best workers, again
Pipeline vulnerabilities? Securing hydrocarbon transit; Predictive analytics hit the mainstream; Dirty pipelines decrease flow, production—pig your line; Ensuring pipeline physical and cyber security