U.S. Manufacturing Activity Loses Momentum in November -- ISM
By Xavier Fontdegloria
Activity in the U.S. manufacturing sector continued to expand in
November, albeit at a slower pace than that of the previous month
as production and new orders cooled, data from a survey compiled by
the Institute for Supply Management showed Tuesday.
The ISM Manufacturing Report on Business PMI for November stood
at 57.5, slipping from 59.3 in October.
The reading is below expectations from economists polled by The
Wall Street Journal, who predicted the PMI to be at 58.0.
The indicator signals that the manufacturing economy continued
its recovery in November, ISM said, with four of five subindexes in
moderate to strong growth territory but employment contracting.
"Survey Committee members reported that their companies and
suppliers continue to operate in reconfigured factories, but
absenteeism, short-term shutdowns to sanitize facilities and
difficulties in returning and hiring workers are causing strains
that will likely limit future manufacturing growth potential," said
Timothy R. Fiore, chair of the ISM Manufacturing Business Survey
ISM compiles the PMI from a survey of manufacturing supply
executives whose responses reflect the change, if any, in the
current month compared with the previous one in certain areas of
business activity. A PMI reading above 50 indicates that the
manufacturing economy is generally expanding, while below 50
indicates that it is generally declining. November marks the sixth
consecutive month of gains for the index.
The production index registered 60.8, a decrease of 2.2 points
compared with October's 63.0, and the new orders index stood at
65.1, down 2.8 points from the October reading of 67.9.
The employment index swung back to contraction territory at
48.4, 4.8 points down from the October reading of 53.2.
"Labor market difficulties, both current and anticipated, at
panelists' companies and their suppliers will continue to dampen
the manufacturing economy until the coronavirus crisis ends," Mr.
The inventories index came in at 51.2, 0.7 point lower than the
October reading of 51.9. The prices index was marginally down to
Five of the big six industry sectors continued to expand
compared with the previous month, the report said. And of the 18
manufacturing industries, 16 reported growth in November.
November's manufacturing PMI also signaled that the U.S. overall
economic activity is rebuilding, as a reading above 42.8 over a
period of time generally indicates an expansion of the overall
economy. This is the seventh consecutive month in which the PMI
indicated such expansion.
Write to Xavier Fontdegloria at firstname.lastname@example.org
(END) Dow Jones Newswires
December 01, 2020 10:31 ET (15:31 GMT)
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