PMI jumps to highest level in 2013 as growth accelerates

Manufacturing Index hits 55.7% in August to extend growth streak

09/03/2013


Manufacturing’s summer surge continued in August, as the monthly ISM Report rose for the third straight month to its highest level of 2013.

The Institute for Supply Management’s PMI for August was at 55.7%, an increase of 0.3 percentage points from July’s high-water mark and the tenth increase in the last 12 months. Since the PMI fell to a regressive level of 49.0% in May, the PMI has climbed almost 7 percentages points to reach a new high for the past 12 months. A figure above 50% indicates general growth for manufacturing. A figure above 43.2% indicates growth for the general economy, so August’s figure marked the 51st consecutive month of economic growth.

All major indicators were positive for August, according to Bradley Holcomb, chairman of the ISM Business Survey Committee. “The Prices Index registered 54%, increasing 5 percentage points from July, indicating that overall raw materials prices increased when compared to last month. Comments from the panel range from slow to improving business conditions depending upon the industry,” Holcomb said.

The Institute for Supply Management's Manufacturing Index hits 55.7%, the highest so far in 2013, in August to extend growth streak. Courtesy: ISMThe New Orders Index rose 4.9 percentage points in August to 63.2%, its highest level of the year, and manufacturers sounded optimistic about future prospects. Among the comments from survey participants:

  • "Slight improvements in both domestic and international sales." (Fabricated Metal Products)
  • "Material prices continue to be favorable; business is steady." (Paper Products)
  • "Slowing down slightly, but still stronger than last year by 20%." (Furniture & Related Products)
  • "Summer seasonal businesses are doing well after a late start." (Printing & Related Support Activities)
  • "Still not seeing the year we had expected. Cautious about the balance of 2013." (Machinery)
  • "Tight government spending still affecting business." (Transportation Equipment)
  • "With improved weather outlook in the central states, agricultural prices are relaxing year over year." (Food, Beverage & Tobacco Products)
  • "We have benefitted from the Yen; seeing a 20 percent decrease in material costs from 2012 to 2013." (Chemical Products)

"The past relationship between the PMI and the overall economy indicates that the average PMI for January through August (52.5%) corresponds to a 3.2% increase in real gross domestic product on an annualized basis,” Holcomb said. “In addition, if the PMI for August (55.7%) is annualized, it corresponds to a 4.2% increase in real GDP annually.”

The Last 12 Months

The Institute for Supply Management's Manufacturing Index hits 55.7%, the highest so far in 2013, in August to extend growth streak. Courtesy: ISM



No comments
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.
System integration: Best practices and technologies to help; Virtualization virtues; Cyber security advice; Motor system efficiency, savings; Product exclusives; Road to Hannover
Collaborative robotics: How to improve safety, return on investment; Industrial Internet of Things, Industrie 4.0: World views; High-performance HMI, Information Integration: OPC and OMG
9 tips: How to integrate a servo system; Process control mathematical models; Serial network grounding; Engineers' Choice Awards; Learn from cyber security mistakes
This article collection contains several articles on the Industrial Internet of Things (IIoT) and how it is transforming manufacturing.
PLCs, robots, and the quest for a single controller; how OEE is key to automation solutions.
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!

Getting to the bottom of subsea repairs: Older pipelines need more attention, and operators need a repair strategy; OTC preview; Offshore production difficult - and crucial
Digital oilfields: Integrated HMI/SCADA systems enable smarter data acquisition; Real-world impact of simulation; Electric actuator technology prospers in production fields
Special report: U.S. natural gas; LNG transport technologies evolve to meet market demand; Understanding new methane regulations; Predictive maintenance for gas pipeline compressors
click me