Manufacturing Contracted for the First Time in Nine Months

The ISM Manufacturing Index registered 49.4 points in August, down 3.2 points from July’s reading and indicating contraction in the manufacturing sector for the first time since February. Of the eighteen manufacturing industries, only six reported growth during the month while eleven reported contraction.

The Employment Index registered 48.3 points in August, down 1.1 points from July’s reading, indicating contraction for the second consecutive month. Only five industries reported employment growth, while nine, including transportation equipment and plastics, reported contraction.

The New Orders Index slipped 7.8 points to 49.1 in August, indicating the first contraction since December 2015. Six industries, including computer and electronic products and miscellaneous manufacturing reported growth in orders, while nine, including wood products and electrical equipment, reported contraction.

Export orders were unchanged in August at 52.5, indicating growth in exports for the sixth consecutive month. Eight industries reported growth in exports, while six industries including, apparel, nonmetallic mineral products, and primary metals reported declines in exports.

The Inventories Index slipped 0.5 points to 49.0, indicating that raw materials inventories are contracting for the 14th consecutive month.

Read the ISM release.