Economic activity in the manufacturing sector ticked up slightly in May as the overall economy grew for the 12th consecutive month after dipping significantly last year due to the coronavirus, according to the nation’s supply executives in the latest Manufacturing ISM Report On Business.
“The May Manufacturing PMI registered 61.2%, an increase of 0.5 percentage point from the April reading of 60.7%,” according to Timothy R. Fiore, CPSM, C.P.M., chair of the Institute for Supply Management Manufacturing Business Survey Committee. “This figure indicates expansion in the overall economy for the 12th month in a row after contraction in April 2020.”
According to the manufacturing sector report, the New Orders Index registered 67%, increasing 2.7 percentage points from the April reading of 64.3%. The Production Index registered 58.5%, a decrease of 4 percentage points compared to the April reading of 62.5%.
The Backlog of Orders Index registered 70.6%, 2.4 percentage points higher compared to the April number of 68.2%. The Employment Index registered 50.9%; 4.2 percentage points lower than the April reading of 55.1%. The Supplier Deliveries Index registered 78.8%, up 3.8 percentage points from the April figure of 75%.
In addition, the Inventories Index registered 50.8%, 4.3 percentage points higher than the April reading of 46.5%. The Prices Index registered 88%, down 1.6 percentage points compared to the April reading of 89.6%. The New Export Orders Index registered 55.4%, an increase of 0.5 percentage point compared to the April reading of 54.9% The Imports Index registered 54%, a 1.8-percentage point increase from the April reading of 52.2%.
“The manufacturing economy continued expansion in May. Business Survey Committee panelists reported that their companies and suppliers continue to struggle to meet increasing levels of demand,” according to Fiore. “Record-long lead times, wide-scale shortages of critical basic materials, rising commodities prices and difficulties in transporting products are continuing to affect all segments of the manufacturing economy.
“Worker absenteeism, short-term shutdowns due to part shortages, and difficulties in filling open positions continue to be issues that limit manufacturing-growth potential.”
Sixteen of 18 manufacturing industries reported growth in May, in the following order: Furniture & Related Products; Nonmetallic Mineral Products; Plastics & Rubber Products; Textile Mills; Primary Metals; Computer & Electronic Products; Electrical Equipment, Appliances & Components; Fabricated Metal Products; Food, Beverage & Tobacco Products; Machinery; Chemical Products; Miscellaneous Manufacturing; Transportation Equipment; Wood Products; Paper Products; and Petroleum & Coal Products. The only industry reporting contraction in May was Printing & Related Support Activities.