Input Stories

Economic activity in the manufacturing industry edged lower in November for the ninth month in a row (Institute for Supply Management).

What’s going on: The Manufacturing PMI declined to 48.2% last month, a half percentage point decrease compared to October’s 48.7%.

• A reading below 50 indicates contraction.

Yes, but … A manufacturing PMI above 42.3% “over a period of time generally indicates an expansion of the overall economy,” according to the ISM. “Therefore, the November Manufacturing PMI indicates the overall economy grew for the 67th straight month after contracting in April 2020.”

The details: New orders registered 47.4% last month, a decrease of two percentage points from October and below the 12-month average (48.9%) for the New Orders Index.

• The ISM’s Production Index, however, expanded in November to 51.4%, up from 48.2% the previous month, with food, beverage and tobacco products; computer and electronic products; and machinery reporting increased production.
• The Employment Index came in at 44%, two percentage points lower than in October. Of the six-largest manufacturing sectors, computer and electronic products and machinery both reported employment growth last month.
• The Prices Index registered 58.5% in November, an increase of half a percentage point from October and six percentage points over the past year. The uptick indicates raw materials prices grew for the 14th straight month in November and at a faster pace.

The bright spot: The Production Index returned to growth, rising to 51.4%, up from October’s 48.2%.