ISM Report: October manufacturing continues autumn rebound

In the final report before the 2012 elections, the Institute for Supply Management reported Nov. 1 that manufacturing continued to improve from the summer slump and continued to grow at a steady rate.

The ISM report’s PMI index rose to 51.7% in October, up slightly from the 51.5% in September and above the 50% threshold for manufacturing growth. In addition, the index showed the economy as a whole grew for the 41^st consecutive month.

“Comments from the panel this month reflect continued concern over a fragile global economy and soft orders across several manufacturing sectors," said Bradley J. Holcomb, CPSM, CPSD, chair of the Institute for Supply Management Manufacturing Business Survey Committee.

Other indices also were up in October, the second straight month of increases after a three-month stretch from June to August where the manufacturing rate hovered just below 50%.

The New Orders Index registered 54.2%, an increase of 1.9 percentage points from September. The Production Index registered 52.4%, an increase of 2.9 percentage points. On the other side of the equation, the Employment Index registered 52.1%, a decrease of 2.6 percentage points, and the Prices Index registered 55%, reflecting a decrease of 3 percentage points.

Respondents are concerned about the situation in Europe and Asia, while seeing firming demand in the U.S. Among the comments:

• "Market is still very soft." (Paper Products)
• "Business is picking up." (Furniture & Related Products)
• "[Our] 4th quarters usually begin to show a slowdown in demand, and this year is no different; prices are also dropping." (Wood Products)
• "Demand down slightly due to customers pre-buying ahead of announced material price increases." (Plastics & Rubber Products)
• "The slowing of capital expenditure in Europe and China has lowered our backlog for Q4." (Computer & Electronic Products)
• "Europe is still very much a concern. Global recovery is still fragile." (Chemical Products)

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