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HomeNewsEconomyISM Report on Business: U.S. Manufacturing Contracted in August

ISM Report on Business: U.S. Manufacturing Contracted in August


The Institute for Supply Management’s Manufacturing Report On Business Survey. (Photo: REUTERS)

The Manufacturing Report on Business, a gauge of U.S. factory activity by the Institute for Supply Management, fell to 49.4 in August from 52.6 in July. Economists expected a slight decline to 52.0 for the month. Readings above 50 point to expansion, while those below indicate contraction.

“Manufacturing contracted in August for the first time since February of this year, as only six of our 18 industries reported an increase in new orders in August, down from 12 in July),” Bradley J. Holcomb, chair of the Institute for Supply Management Manufacturing Business Survey Committee, said. “Only eight of our 18 industries reported an increase in production in August, down from nine in July.”

Of the 18 manufacturing industries only 6 are reporting growth in August, in the following order: Printing & Related Support Activities; Nonmetallic Mineral Products; Computer & Electronic Products; Miscellaneous Manufacturing; Food, Beverage & Tobacco Products; and Chemical Products.

The remaining 11 industries reporting contraction in August — listed in order — are: Electrical Equipment, Appliances & Components; Apparel, Leather & Allied Products; Plastics & Rubber Products; Furniture & Related Products; Transportation Equipment; Machinery; Textile Mills; Paper Products; Petroleum & Coal Products; Primary Metals; and Fabricated Metal Products.

August 2016
Index Series
Direction Rate
PMI® 49.4 52.6 -3.2 Contracting From Growing 1
New Orders 49.1 56.9 -7.8 Contracting From Growing 1
Production 49.6 55.4 -5.8 Contracting From Growing 1
Employment 48.3 49.4 -1.1 Contracting Faster 2
Supplier Deliveries 50.9 51.8 -0.9 Slowing Slower 4
Inventories 49.0 49.5 -0.5 Contracting Faster 14
Customers’ Inventories 49.5 51.0 -1.5 Too Low From Too High 1
Prices 53.0 55.0 -2.0 Increasing Slower 6
Backlog of Orders 45.5 48.0 -2.5 Contracting Faster 2
New Export Orders 52.5 52.5 0.0 Growing Same 6
Imports 47.0 52.0 -5.0 Contracting From Growing 1
OVERALL ECONOMY Growing Slower 87
Manufacturing Sector Contracting From Growing 1

Manufacturing ISM® Report On Business® data is seasonally adjusted for New Orders, Production, Employment and Supplier Deliveries indexes.

*Number of months moving in current direction.

Written by

PPD Business, the economy-reporting arm of People's Pundit Daily, is "making sense of current events." We are a no-holds barred, news reporting pundit of, by, and for the people.

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