ISM Reports Manufacturing Remains in Growth Mode in May
June 2, 2012Manufacturing continues to provide consistent growth at a time when a majority of economic indicators remain skittish.
That was made clear in the Institute for Supply Management’s (ISM) May Manufacturing Report on Business which was released June 1.
For the month of May, the PMI, ISM’s index used to measure manufacturing activity, was 53.5, which was 1.3 percent below April. A reading of 50 or higher indicates growth is occurring. Economic activity in the manufacturing sector has expanded for 34 straight months and overall economic activity has expanded for 36 straight months.
ISM reported that New Orders, which are commonly referred to as the ‘engine’ which drives manufacturing, were up 1.9 percent at 60.1 in May and are at its highest level since April 2011.
May Supplier Deliveries dipped slightly, down 0.5 percent to 48.7, and Inventories fell 2.5 percent to 46.0.
This Inventory reading is the lowest level it has been at in 2012, according to ISM data. And coupled with the strong New Orders number, it demonstrates the need to build up inventory levels, which are then drawn down by suppliers.
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