New manufacturing orders, production, employment grow

Tempe, AZ—Many supply chain executives report that U.S. economic activity in the manufacturing sector grew in March 2004 for the 10th consecutive month, while overall economy grew for the 29th consecutive month, according to the latest “Manufacturing ISM Report on Business” from the Institute for Supply Management (ISM).


Tempe, AZ— Many supply chain executives report that U.S. economic activity in the manufacturing sector grew in March 2004 for the 10th consecutive month, while overall economy grew for the 29th consecutive month. Their responses were compiled and analyzed in the latest “Manufacturing ISM Report on Business” from the Institute for Supply Management (ISM).

'The manufacturing sector had another good month in March as the Purchasing Managers' Index (PMI) has now been above the 60% for five consecutive months. Both new orders and production remain strong and have significant momentum going into the second quarter,” says Norbert J. Ore, chair of ISM’s Manufacturing Business Survey Committee and Georgia-Pacific Corp.’s group director for strategic sourcing and procurement.

ISM's Backlog of Orders Index indicates that order backlogs increased in March, while the Employment Index grew for the fifth consecutive month. ISM's Prices Index indicates that manufacturers once again experienced higher prices in their purchases, and at the highest rate since January 1995. Meanwhile, the New Export Orders and Import Indexes continue to grow, with New Export Orders accelerating significantly during the month.

Comments from purchasing and supply managers are focused on higher energy and material costs, the availability of certain metals and the weaker dollar. As lead times extend, their concerns are shifting from cost issues to availability.

ISM's PMI registered 62.5% in March, an increase of 1.1 percentage points when compared to 61.4% in February. ISM's New Orders Index declined 0.7 percentage point from 66.4% in February to 65.7% in March. ISM's Production Index increased 1.6 percentage points from 63.9% in February to 65.5% in March. The ISM Employment Index was at 57% for March, an increase of 0.7 percentage point when compared to the 56.3% reported in February.

ISM's Supplier Deliveries Index registered 67.9%, which wasx in March is 86%, or 4.5 percentage points higher than the 81.5% reported in February.

In addition, ISM's Backlog of Orders Index increased 1.5 percentage points, registering 63.5% in March compared to 62% in February. ISM's New Export Orders Index registered 62%, an increase of 7.1 percentage points from February's 54.9% level. ISM's Imports Index decreased 3.4 percentage points to 56.8% in March, down from 60.2% in February.

'The first quarter of 2004 was very strong for the manufacturing sector and the economy overall. Our survey respondents generally indicate that business is quite strong,' adds Ore.

For more information, or to read the report, visit

Control Engineering Daily News Desk
Jim Montague, news editor

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