PMI index slips again due to supply slowdown

Despite overall growth, the dock workers' slowdown in California are impacting inventories.


The fundamental strengths of manufacturing remain in place, but the effect of the months-long West Coast dock slowdown has had more serious effects on the overall manufacturing growth curve.

The January PMI report from the Institute for Supply Management slipped 1.6 percentage points to 53.5%, the third straight month of decline after the index hit 57.9% in October. It was still the 20th straight month the index finished above the manufacturing growth mark of 50%, and ISM officials said there was overall optimism among ISM committee members who commented for this month's index.

"Comments from the panel indicate that most industries, but not all, are experiencing strong demand as 2015 kicks off," said Bradley Holcomb, chairman of the ISM's Business Survey Committee. "The West Coast dock slowdown continues to be a problem, negatively impacting both exports and imports as well as inventories." Still, 14 of the 18 manufacturing industries showed growth in January.

Each of the indices fell in January. The Production Index dropped 1.2 percentage points to 57.7%, the Employment Index fell 1.9 percentage points to 54.1%, and the New Orders Index dropped 4.9 percentage points to 52.9%.

The January PMI report from the Institute for Supply Management slipped 1.6 percentage points to 53.5%, the third straight month of decline after the index hit 57.9% in October. It was still the 20th straight month the index finished above the manufacturiAmong the comments from committee members:

  • "Strong customer demand for our products continues to grow." (Food, Beverage & Tobacco Products)
  • "Consumer demand remains strong for automotive. Seeking alternatives to maximize production with existing production capacity." (Transportation Equipment)
  • "Sales have stayed very strong even with the dip in oil prices." (Computer & Electronic Products)
  • "Dock problems in California continue to delay shipment out of the West Coast. Most material prices are the same except resin prices are down." (Chemical Products)
  • "Business conditions are good, stable to improving." (Miscellaneous Manufacturing)
  • "West Coast port slowdown is getting serious. Mill has 40+ days of production at the ports and various warehouses." (Paper Products)
  • "Business in 2015 has started off on a fast pace. Very busy." (Primary Metals)

The PMI Index finished above the overall economic growth level of 43.2% in January, making it 68 straight months the index was above that threshold.

The Top Plant program honors outstanding manufacturing facilities in North America. View the 2017 Top Plant.
The Product of the Year program recognizes products newly released in the manufacturing industries.
Each year, a panel of Control Engineering and Plant Engineering editors and industry expert judges select the System Integrator of the Year Award winners in three categories.
SCCR, 2018 Maintenance study, and VFDs in a washdown environment.
Welding ergonomics, 2017 Salary Survey, and surge protection
2017 Top Plant winner, Best practices, Plant Engineering at 70, Top 10 stories of 2017
Product of the Year winners, Pattern recognition, Engineering analytics, Revitalize older pump installations
Control room technology innovation; Practical approaches to corrosion protection; Pipeline regulator revises quality programs
The cloud, mobility, and remote operations; SCADA and contextual mobility; Custom UPS empowering a secure pipeline
Setting internal automation standards
Knowing how and when to use parallel generators
PID controllers, Solar-powered SCADA, Using 80 GHz radar sensors

Annual Salary Survey

Before the calendar turned, 2016 already had the makings of a pivotal year for manufacturing, and for the world.

There were the big events for the year, including the United States as Partner Country at Hannover Messe in April and the 2016 International Manufacturing Technology Show in Chicago in September. There's also the matter of the U.S. presidential elections in November, which promise to shape policy in manufacturing for years to come.

But the year started with global economic turmoil, as a slowdown in Chinese manufacturing triggered a worldwide stock hiccup that sent values plummeting. The continued plunge in world oil prices has resulted in a slowdown in exploration and, by extension, the manufacture of exploration equipment.

Read more: 2015 Salary Survey

Maintenance and reliability tips and best practices from the maintenance and reliability coaches at Allied Reliability Group.
The One Voice for Manufacturing blog reports on federal public policy issues impacting the manufacturing sector. One Voice is a joint effort by the National Tooling and Machining...
The Society for Maintenance and Reliability Professionals an organization devoted...
Join this ongoing discussion of machine guarding topics, including solutions assessments, regulatory compliance, gap analysis...
IMS Research, recently acquired by IHS Inc., is a leading independent supplier of market research and consultancy to the global electronics industry.
Maintenance is not optional in manufacturing. It’s a profit center, driving productivity and uptime while reducing overall repair costs.
The Lachance on CMMS blog is about current maintenance topics. Blogger Paul Lachance is president and chief technology officer for Smartware Group.
The maintenance journey has been a long, slow trek for most manufacturers and has gone from preventive maintenance to predictive maintenance.
This digital report explains how plant engineers and subject matter experts (SME) need support for time series data and its many challenges.
This digital report will explore several aspects of how IIoT will transform manufacturing in the coming years.
Maintenance Manager; California Oils Corp.
Associate, Electrical Engineering; Wood Harbinger
Control Systems Engineer; Robert Bosch Corp.
This course focuses on climate analysis, appropriateness of cooling system selection, and combining cooling systems.
This course will help identify and reveal electrical hazards and identify the solutions to implementing and maintaining a safe work environment.
This course explains how maintaining power and communication systems through emergency power-generation systems is critical.
click me