Seeing is (Barely) Believing

The ISM Report on Manufacturing showed signs the economy as a whole and manufacturing in particular are continuing to grow at a more-or-less steady pace. The Manufacturing PMI was 51.7, up slightly from last month, an indicator of slightly faster growth. Based on past experience, the PMI data also suggest that the overall U.S. economy has been growing for 37 consecutive months. The same for growth in manufacturing employment.
One would expect that survey respondents would be providing cheery comments to go with those numbers, but consistent with all the uncertainties of these times, the quotes went more like this:

  • “The slowing of capital expenditure in Europe and China has lowered our backlog for Q4.” (Computer & Electronic Products)
  • “We see a general softening in the steel and automotive markets in the fourth quarter.” (Fabricated Metal Products)
  • “Cuts in healthcare reimbursement rates continue to negatively affect top-line revenue.” (Miscellaneous Manufacturing)
  • “Sales and order intake have slowed.” (Primary Metals)
  • “Europe is still very much a concern. Global recovery is still fragile.” (Chemical Products)

Here’s the summary chart for some of the sections of the report.

PMI™ 51.7 51.5 +0.2 Growing Faster 2
New Orders 54.2 52.3 +1.9 Growing Faster 2
Production 52.4 49.5 +2.9 Growing From Contracting 1
Employment 52.1 54.7 -2.6 Growing Slower 37
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