Economic activity in the manufacturing sector contracted in November for the first time since November 2012, while the overall economy grew for the 78th consecutive month, according to purchasing executives participating in the latest Manufacturing ISM Report On Business published by the Institute for Supply Management (ISM), Tempe, Ariz.
Bradley Holcomb, chair of the ISM Manufacturing Business Survey Committee, said, “The November PMI registered 48.6%, a decrease of 1.5 percentage points from the October reading of 50.1%. The New Orders Index registered 48.9%, a decrease of four percentage points from the reading of 52.9% in October.”
The ISM survey respondents offered some interesting anecdotal comments on different manufacturing segments. “The oil and gas industry is realizing that ‘low’ oil prices are now the new reality with expectations to continue at this level for some time,” said a purchasing manager in the petroleum and coal products industry.
Another respondent said the auto business remains strong, and a purchasing manager in ttransportation equipment said business was still good. Two respondents commented on a slowdown in business from China. “Downturn in China and European markets are negatively affecting our business,” said an executive in the machinery business, while a respondent in primary metals said, “Strong dollar is slowing our sales to China as they can buy in Europe.”