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The NFIB Small Business Optimism Index inched up 0.8 points to 99.0 in November, remaining slightly above the 52-year average of 98. November’s increase was due primarily to a jump in sales in the previous quarter and sales expectations going forward. Of the 10 components included in the index, six increased, three decreased and one stayed the same. Meanwhile, the Uncertainty Index increased 3 points to 91, still well above the 51-year average (68) and above the average since 2016 (80).

Labor quality was again cited as the top concern for small business owners, with 21% reporting it as the most important problem, but was down 6 points from October. Business owners experienced difficult hiring conditions, as 33% struggled to fill open jobs, up 1% from October and the first increase since June. The share of business owners reporting inflation as a top problem rose 3 points from October to 15%, with a net 34% raising prices, up 13 points from the prior month and the largest monthly jump in survey history. Meanwhile, taxes fell to third in the list of concerns, with 14% reporting it as a top problem, down 2 points from October.

A net 26% of small business owners reported raising compensation, unchanged in November after falling 5 points in October. Meanwhile, 24% of business owners plan to raise compensation in the next three months, up 5 points from October. Pressure on profitability weakened in November, with positive profit trends rising 2 points from October to a net negative 23%. Among owners reporting lower profits, 27% blamed weaker sales, 16% cited increased material costs, 12% noted labor costs and 9% mentioned usual seasonal changes. Meanwhile, 4% reported their last loan was harder to get than previous attempts, down 1 point from October, and a net 2% of owners cited paying a higher rate on their most recent loan, up 1 point from the prior month.

The outlook for general business conditions fell 5 points to 15%. Furthermore, expectations for better business conditions have fallen 32 points since the start of the year. On the other hand, 13% reported that it is a good time to expand their business, unchanged from October and a rather weak reading compared to times of economic expansion. Overall, affordability continues to be a concern for small business owners, and uncertainty remains high.

The Federal Open Market Committee lowered its interest rate target range by 25 basis points to 3.50%–3.75% at its December meeting. As it did at its previous two meetings, the committee judged that downside risks to employment warranted an additional cut to its interest rate target. Three FOMC members—Stephen Miran, Austan Goolsbee and Jeffrey Schmid—dissented. Miran preferred to lower the target range by 50 basis points, while Goolsbee and Schmid preferred to keep the rate steady. After the FOMC just concluded its multiyear reduction of its Treasury holdings at its October meeting, the FOMC announced at this meeting that it will initiate purchases of shorter-term Treasuries for the first time since 2022.

In the press conference following the meeting, Federal Reserve Chairman Jerome Powell noted that the data that has become available since the government shutdown suggests that the outlook for employment and inflation has not changed much since their previous meeting, with conditions in the labor market cooling while inflation remains elevated. Chairman Powell noted that he believes some of the government data could be greatly distorted due to the government shutdown, so the committee may not be heavily persuaded to change its position by new data by the January meeting.

The FOMC’s summary of economic projections, which maps out the Federal Reserve’s expectations for where interest rates may be headed in the future, signaled a similar, mixed stance compared to the September summary. Twelve Federal Reserve officials project there will be additional rate cuts across 2026, while four anticipate no additional rate cuts next year, and three predict a 25-basis-point hike. Meanwhile, the projections show that officials still expect inflation to remain elevated, averaging 2.4% in 2026, albeit less so than the 2.6% average projected in September. At the same time, the projections show officials expect real GDP to rise more in 2026 than previously anticipated.

Job openings for manufacturing increased by 25,000 to 410,000 in October. Nondurable goods job openings in October inched up by 1,000 to 130,000, while durable goods job openings grew by 24,000 to 280,000. The manufacturing job openings rate rose to 3.1% from 2.9% in September but declined from 3.4% the previous year. The rate for nondurable goods manufacturing stayed the same at 2.6%, while it increased 0.3 percentage points to 3.4% for durable goods.

In the larger economy, the number of job openings ticked up to 7.7 million, an increase of 12,000 from September and of 55,000 from the previous year. The job openings rate stayed the same from September at 4.6%, also the same rate as last year. This data reflects an overall labor market that has eased back to pre-pandemic levels, but remains relatively tight from a historical perspective.

The number of hires in the overall economy decreased 218,000 to 5.1 million in October and 201,000 from the previous year. The hires rate for the overall economy edged down 0.2 percentage points in October to 3.2%. Meanwhile, the hires rate for manufacturing ticked down 0.1 percentage point to 2.4%. The hires rate for durable goods stayed the same at 2.4%, while the hires rate for nondurable goods declined 0.2 percentage points to 2.5%.

In the larger economy, total separations, which include quits, layoffs, discharges and other separations, declined 214,000 from September to 5.1 million and 235,000 from the previous year. The total separations rate edged down 0.1 percentage point to 3.2% for the overall economy but stayed the same at 2.6% for manufacturing. Within that rate, layoffs and discharges increased by 10,000 in October for manufacturing, while quits fell by 2,000. The quit and layoff rates continue to remain lower for manufacturing than the total nonfarm sector.

Global technology company Siemens is expanding its electrician and manufacturing-expert workforces significantly (DC VELOCITY).

What’s going on: “In response to the nation’s urgent need for a skilled and adaptable workforce, Siemens today announced an expansion of its workforce development partnerships to help train 200,000 electricians and manufacturing experts by 2030.”

How they’ll do it: The firm will partner with community colleges, trade groups, technical programs and industry leaders to create training pathways, including certifications and technical programs.

• The move is a key piece of Siemens’ larger plan to contribute to “U.S. reindustrialization.”

Why it’s happening: Demand for skilled trades is exploding, according to Siemens, propelled largely by the rapidly expanding interest in and use of digital tools and artificial intelligence.

• “[E]lectrician jobs are expected to grow 9% from 2024 to 2034, well above the national average. According to the U.S. Bureau of Labor Statistics, an estimated 81,000 openings are expected each year, largely due to retirements and career transitions.”
• The article cites a 2024 joint study by Deloitte and the Manufacturing Institute, the NAM’s 501(c)3 workforce development and education affiliate, which found the manufacturing sector will need up to 3.8 million workers by 2033—and half of those jobs could go unfilled if current labor trends continue.

Now’s the time:  “As the effort to reindustrialize our economy accelerates and a new industrial tech sector emerges, now is the time to build workforce development ecosystems with the scale and impact needed to prepare a new generation of AI-ready leaders in the skilled trades,” Siemens USA Interim President and CEO Ann Fairchild said in a release.

From the MI: “Manufacturers’ success will always rely on a skilled and capable workforce. Siemens’ commitment is a powerful example of the leadership and forward-thinking investment our sector needs,” said MI President and Executive Director Carolyn Lee. “Programs like this help build and sustain the workforce our economy depends on.”

Sustainable construction leader Saint-Gobain North America thinks it may have a solution to the nation’s dearth of manufacturing talent: “a long-term program that brings modern manufacturing into the classroom and the classroom to the site floor” (Newsweek).

What’s going on: In a recent op-ed, Saint-Gobain North America CEO Mark Rayfield discusses manufacturing’s status as a major economic engine—but says that to maintain that distinction, the sector “will need to fill 3.8 million manufacturing jobs over the next decade” (citing a joint study from Deloitte and the Manufacturing Institute, the NAM’s 501(c)3 workforce development and education affiliate).

• If current trends continue, 1.9 million roles could go unfilled, Rayfield continued, again citing the MI/Deloitte study.

Why it’s happening: “For years, students have been steered toward four-year degrees, while trade careers, especially in manufacturing, have been overlooked or stigmatized,” Rayfield writes.

• In fact, just 12% of American students have actually visited a manufacturing facility, according to the MI.

The fix: To fill those roles, Saint-Gobain North America recently launched the workforce development program “ Sustaining Futures, Raising Communities,” which “gives students a chance to explore immersive manufacturing environments with a focus on plant jobs that do not require an advanced degree,” according to the company.

• The company is already seeing some success from the program, Rayfield writes in Newsweek.
• “Across the country, we have already partnered with schools in North Carolina and Minnesota, and we will partner with over 10 additional high schools in Louisiana, Massachusetts, Texas, Pennsylvania, Missouri and Arkansas” this school year.

Why it’s working: “Let them get into our factories and see our employees and see that it’s not your 1950s manufacturing job, where you’re hammering the same nut as it goes by,” Rayfield told  Semafor.

• Manufacturing jobs “are [artificial intelligence]-enabled, they’re tech-enabled, they’re Industry 4.0, they’re mechanical engineering jobs, and they’re extremely rewarding,” he added.

From the MI: “Programs like Saint-Gobain’s show what’s possible when manufacturers open their doors and help students see modern manufacturing up close,” said MI President and Executive Director Carolyn Lee. “These experiences don’t just change perceptions; they create pathways to meaningful careers and strengthen the workforce our industry needs to compete.”

U.S. import prices stayed the same in September, after advancing 0.1% in August, with lower fuel import prices offsetting higher nonfuel import prices. Over the past year, import prices rose 0.3%. Meanwhile, U.S. export prices also remained the same in September, after ticking up 0.1% in August. Over the past year, export prices climbed 3.8%, the largest over-the-year rise since December 2022.

In September, U.S. import prices for manufacturing rose 0.3% over the year, but with significant divergences in prices across the industry, while U.S. import prices for nonmanufacturing decreased 2.2% over the year. Beverage and tobacco product manufacturing experienced the most significant over-the-year U.S. import price declines in September, falling 13.8%. On the other hand, the greatest yearly increase in U.S. import prices occurred in primary metal manufacturing, which advanced 12.1% from September 2024. Meanwhile, U.S. export prices for manufacturing in September grew 4.1% over the year, with primary metal manufacturing export prices exhibiting the largest rise (29%).

Fuel import prices decreased 1.5% over the month in September, following a 0.5% decline in August and a 2.8% increase in July. Lower prices for petroleum and natural gas drove the drop, falling 1.5% and 3.0%, respectively. Over the past year, fuel import prices have fallen 4.0%. Import petroleum prices dropped 5.1% over the year in September, while natural gas prices surged 62.9% over that period. Nonfuel import prices rose 0.2% in September, following a 0.1% uptick in August. Higher prices for consumer goods and nonfuel industrial supplies and materials more than offset lower prices for capital goods and foods, feeds and beverages. Nonfuel import prices increased 0.8% on an over-the-year basis.

After declining 0.2% in August, agricultural export prices advanced 0.3% in September. Over the past 12 months, agricultural export prices rose 4.4%. Meanwhile, nonagricultural export prices stayed the same in September. Higher prices for consumer goods, nonagricultural industrial supplies and materials and capital goods drove the increase. Over the past year, nonagricultural export prices jumped 3.7%, the largest over-the-year increase since December 2022.

New orders for manufactured goods inched up 0.2% in September, following a 1.3% increase in August. At the same time, new orders for manufactured goods grew 3.5% over the year. When excluding transportation, new orders rose 0.2% over the month and 0.8% over the year. Orders for durable goods moved up 0.5%, following a 3.0% increase in August. Year to date, durable goods orders are up 7.3%. Meanwhile, nondurable goods orders ticked down 0.1% in September, after falling 0.4% in August. Nondurable goods are down 0.1% over the year.

New orders for defense aircraft and parts led the increase in durable goods orders for a second consecutive month, jumping 30.9%, following August’s 48.3% surge. In September, the largest monthly decrease occurred in mining, oil field and gas field machinery, which fell 17.8%, after increasing 22.8% the prior month. The largest over-the-year changes occurred in nondefense aircraft and parts (up 118%) and photographic equipment (down 5.7%).

Factory shipments stayed the same in September, after stepping down 0.3% in August. Shipments over the year rose 1.4%. Shipments excluding transportation increased 0.2% in September, following a 0.3% decrease the previous month. Shipments for durable goods improved 0.1% in September, following a 0.1% decline in August, and are up 3.0% year to date. Meanwhile, nondurable goods shipments inched down 0.1% after falling 0.4% the prior month and are down 0.1% year to date.

Unfilled orders for all manufacturing industries increased 0.7% in September after a similar rise in August. Unfilled orders over the year jumped 8.3%. Inventories ticked down 0.1%, after a similar decrease the prior month, and the inventories-to-shipments ratio remained the same at 1.56. The unfilled orders-to-shipments ratio for durable goods increased from 6.93 in August to 6.98 in September.

The S&P Global Manufacturing PMI was 52.2 in November, down from the October reading of 52.5. New orders rose in November, with manufacturers noting gains among both existing and new clients. However, exports declined for the fifth consecutive month, as tariffs were reported to have led to the steepest drop in new export orders since July. Meanwhile, prices on inputs continued to increase, but the degree of pass-through weakened, and selling price inflation was near lows for this year. In sum, the rate of inflation remained elevated from a historical context in November.

Production continued to rise, while sales remained weak, allowing stocks of finished goods to rise for the fourth consecutive month, beating October’s record for the quickest rate of increase in the survey’s 18-year history. In anticipation of higher future production, employment growth in November was the steepest in three months and contributed to a decline in backlogs. Meanwhile, delivery times continued to worsen for a third consecutive month, a result of import challenges from tariffs.

Plans for new investments and products led to an increase in business confidence, hitting its highest level since June. At the same time, the end of the federal government shutdown was noted as supplementing the boost in confidence, with manufacturers hopeful of improved policy support and political stability.

In November, growth in global manufacturing activity weakened from October, decreasing from 50.9 to 50.5. Output and new orders both expanded for the fourth consecutive month in November. Meanwhile, inventories signaled contractions, and lead times continued to show strains on global supply chains, lengthening for the 18th consecutive month. Employment fell as lower staffing levels in China, the U.K. and the Eurozone contrasted higher staffing in Japan, India and the U.S. On the other hand, new export orders contracted for the eighth consecutive month but at a slower pace than October.

Thailand, India, Colombia and Vietnam had the highest PMI readings in November. On the other hand, Mexico, Germany, Russia and Canada were some of the larger nations to register declines in activity. The upturn in manufacturing output occurred for consumer and intermediate goods industries, while investment goods saw a decrease in November.

Meanwhile, price pressures rose from lower levels in October and accelerated faster in developed nations compared to emerging markets in November. Forward-looking indicators were positive, with business optimism hitting a five-month high but remaining below long-run averages for the 20th consecutive month.

In November, the U.S. manufacturing sector contracted for the ninth consecutive month and at a faster pace than the prior month, with the ISM Manufacturing^® PMI decreasing to 48.2% from 48.7% in October. Two of the four demand indicators improved in November, with the New Export Orders and Customers’ Inventories Indexes rising to 46.2% and 44.7%, respectively. Meanwhile, the New Orders and Backlog of Orders Indexes contracted at faster rates. On the other hand, the Production Index returned to growth after contracting in October, increasing from 48.2% to 51.4%. 

The New Orders Index contracted for the third consecutive month and at a faster rate, falling 2.0 percentage points from October. The index hasn’t shown consistent growth since a 24-month streak of expansion ended in May 2022. Of the six-largest manufacturing sectors, three—computer and electronic products; machinery; and food, beverage and tobacco products—reported an increase in new orders. Respondents continued to note concern about near-term demand, primarily driven by tariff costs and uncertainty.

The New Export Orders Index contracted for the ninth consecutive month but at a slower pace, 1.7 percentage points higher than October. The continued contraction is likely indicative of dampened demand amid ongoing trade tensions and policy uncertainty. Meanwhile, the Imports Index contracted for the eighth consecutive month but at a slightly slower rate, up 3.5 percentage points to 48.9% in November. Imports continued to contract as a result of tariff pricing and weaker demand compared to prior months.

The Employment Index contracted for the 10th consecutive month and at a faster pace than the prior month, down 2.0 percentage points from October to 44%. Of the six-largest manufacturing sectors, two—computer and electronic products and machinery—reported increased employment. Companies continued to focus on layoffs and attrition to restrict headcounts due to uncertainty around near- to mid-term demand. For every comment on hiring, 3.4 respondents noted reduced headcounts.

The Prices Index increased 0.5 percentage points to 58.5%, indicating raw materials prices grew for the 14th straight month in November, and at a faster pace. Of the six-largest manufacturing sectors, five—machinery; computer and electronic products; transportation equipment; chemical products; and food, beverage and tobacco products—reported increased prices. The increase continues to be driven by higher steel and aluminum prices impacting the entire supply chain, as well as the tariffs applied to most imported goods. Roughly 27.2% of companies reported paying higher prices, slightly down from 27.3% in October but still up from 21% in January.