Economic activity in the manufacturing sector grew in May for the 24th consecutive month, while the overall economy grew for the 43rd consecutive month, according to the latest survey of purchasing managers by the Institute for Supply Management (ISM), Tempe, Ariz. ISM’s Purchasing Managers Index is 51.4 percent in May, a decrease of 1.9 percentage points when compared to 53.3 percent in April.
“The manufacturing sector grew for the 24th consecutive month in May based on the ISM data,” said Norbert J. Ore, chair of the Institute for Supply Management Manufacturing Business Survey Committee and group director, strategic sourcing and procurement, Georgia Pacific Corp. “While this represents the longest period of growth in the last 16 years, the data also indicates that the sector is losing momentum, as this month’s PMI is at the lowest level since June 2003 when it registered 50.4 percent. The rate of growth in new orders continues to decline, and this month only 11 of 20 industries are reporting improvement when comparing May to April. The employment index failed to grow, ending18 months of employment growth. The manufacturing sector is definitely slowing, and the question is whether a somewhat stronger dollar and the burden of high energy costs are slowly bringing this manufacturing growth cycle to end.”