Manufacturing economy on a roll

12/07/2005


Tempe, AZ —Economic activity in the manufacturing sector grew in November for the 30th consecutive month, while the overall economy grew for the 49th consecutive month, says the Institute for Supply Management (ISM) in the latest “Manufacturing ISM Report On Business.”

It reported that the Purchasing Managers’ Index (PMI) indicates that the manufacturing economy grew in November for the 30th consecutive month. PMI for November registered 58.1%, a decrease of 1% when compared to October's reading of 59.1%. A reading >50% indicates that the manufacturing economy is generally expanding; &50% indicates that it is generally contracting. ISM’s data showed November performance in the:

  • New Orders Index at 59.8%, or 1.9% lower than the 61.7% registered in October, and November is the 31st consecutive month the index has exceeded 50%;

  • Production Index registering 60.6%, or 1.4% lower than the 62% reported in October. November is the 31st consecutive month of growth in the index;

  • Employment Index, at 56.6%— showing growth for the fifth consecutive month—an increase of 1.5% over October’s 55%;

  • Supplier Deliveries Index at 58.3%, a decrease of 3.4% compared to October's 61.7%;

  • Inventories Index indicated 49.3%, indicating a slower rate of liquidation when compared to October's reading of 48.1%. November's index represents a 1.2% increase over October. So manufacturers' inventories declined in November for the eighth consecutive month; and

  • Backlog of Orders Index registered 53%, indicating manufacturers' backlogs are growing—a 2.5% decrease compared to the 55.5% reported in October.

The 17 industries reporting growth in November, listed in order, include: apparel; rubber and plastic products; electronic components and equipment; tobacco; textiles; miscellaneous*; primary metals; food; paper; chemicals; industrial- and commercial-equipment and computers; instruments and photographic equipment; furniture; transportation and equipment; fabricated metals; glass, stone and aggregate; and printing and publishing.

Richard Phelps , senior editor, Control Engineering





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