So Far So Good for U.S. Manufacturing in 2015

The June report from the Institute for Supply Management (ISM) indicates that U.S. manufacturing industry is growing.  This is encouraging news after seeing lower  numbers during much of the spring. ISM’s report uses a market indicator known as PMI. A PMI greater than 50 generally indicates growth while a PMI below 50 indicates contraction. June’s PMI was 53.5%, the highest since January 2015.

U.S. Manufacturing Sees Job Growth

Other positive news in the U.S. manufacturing industry included strong job growth rising 3.8% between May and June. According to Bradley Holcomb, chair of the ISM’s Manufacturing Business Survey Committee, “That’s actually the largest growth in employment since 2009, and it really does stand out and is forward looking. Manufacturers wouldn’t be adding employees unless they were confident a steady stream of new orders was coming in”.

Backlogs Shrink but Customer Inventories Rise

One negative sign for U.S. manufacturing is a shrinking backlog dropping 6.7% to 47% in June. In particular manufacturers of computer and electronic products, fabricated metal products, and machinery saw shrinking backlogs. However the reduction in manufacturing backlogs should be taken in context as the ISM report indicated rises in new orders and customer inventories as well.

To learn more view the full ISM report. Stay up to date on the latest industry trends and product news by subscribing to bisco industries’ blog.