Economic activity in the manufacturing sector grew in December, with the overall economy achieving a 19th consecutive month of growth, say the nation’s supply executives in the latest Manufacturing ISM Report On Business.
“The December Manufacturing PMI registered 58.7% , a decrease of 2.4 percentage from the November reading of 61.1% percent. This figure indicates expansion in the overall economy for the 19th month in a row after a contraction in April 2020,” sqid Timothy R. Fiore, chairman, Institute for Supply Management‘s business survey committee.
The New Orders Index registered 60.4%, down 1.1 percentage points compared to the November reading of 61.5%. The Production Index registered 59.2% , a decrease of 2.3 percentage points compared to the November reading of 61.5%. The Prices Index fell 68.2% 14.2 percentage points, while the Backlog of Orders Index rose 0.9 percentage point to 62.8%.
The Employment Index registered 54.2%, 0.9 percentage point higher than in November reading. Supplier deliveries slowed and the Inventories Index fell 2.1 percentage points to 54.7%, New Export Orders Index eased 0.4 percentage point to 53.6% and the Imports Index rose 1.2 percentage points to 53.8%.
“The U.S. manufacturing sector remains in a demand-driven, supply chain-constrained environment, with indications of improvements in labor resources and supplier delivery performance,” Fiore said.
“Shortages of critical lowest-tier materials, high commodity prices and difficulties in transporting products continue to plague reliable consumption. Coronavirus pandemic-related global issues — worker absenteeism, short-term shutdowns due to parts shortages, employee turnover and overseas supply chain problems — continue to impact manufacturing.
“However, panel sentiment remains strongly optimistic, with six positive growth comments for every cautious comment, down slightly from November. The forecast released this month indicates a strong 2022 performance expectation in terms of revenue growth and profitability, he said.