Manufacturing Sector Growth Rose in July

The ISM Manufacturing Index registered 54.2 points in July, an increase of 1.6 percentage points from the June reading of 52.6 points, according to the Institute for Supply Management. Comments from respondents were generally optimistic regarding the near-term outlook.

Of the 18 manufacturing industries, Wood Products; Furniture & Related Products; Textile Mills; Printing & Related Support Activities; Food, Beverage & Tobacco Products; Plastics & Rubber Products; Chemical Products; Apparel, Leather & Allied Products; Computer & Electronic Products; Primary Metals; Petroleum & Coal Products; Miscellaneous Manufacturing; and Electrical Equipment, Appliances & Components reported growth in July.

The 3 industries reporting contraction in July, in order, were: Transportation Equipment; Machinery; and Fabricated Metal Products.

The Employment Index registered 44.3%, an increase of 2.2 percentage points from the June reading of 42.1%. This is the 12th consecutive month of employment contraction.

The New Orders Index registered 61.5% in July, an increase of 5.1 percentage points from June’s reading of 56.4%. This is the second month of growth for the index.

The New Export Orders Index registered 50.4%, up 2.8 percentage points from June.

The Inventories Index registered 47.0% in July, a decrease of 3.5 percentage points from the June reading of 50.5%. Inventories contracted after two months of growth. “Inventory levels were impacted by increases in production output and restrained by continuing supplier difficulties. Panelists also indicated restraint in increasing inventories due to uncertainty in overall future market demand” said Timothy R. Fiore, CPSM, C.P.M., Chair of the ISM Manufacturing Business Survey Committee.

Read the ISM release.