ISM Manufacturing Index Slides in March

Tempe, AZ, April 2, 2007--Economic activity in the manufacturing sector expanded in March but at slower rates, said the nation's supply executives in the latest Manufacturing ISM Report On Business.

The index was off to 50.9 in March from February’s 52.3, showing slower growth. The new order index slid to 51.6 from 54.9. The employment contracted in March with a reading of 48.7, from February’s 51.1.

The report was issued today by Norbert J. Ore, chairman of the association’s Business Survey Committee. The report said, “Manufacturing improved slightly in March as the PMI reflected growth for the second consecutive month. It said tThe New Orders and Production Indexes advanced while the Employment and Inventories Indexes declined. A positive for March is the Customers' Inventories Index (falling below 50 percent after five consecutive months above the breakeven line), which is a possible indication that manufacturers' inventories are nearing satisfactory levels. On the negative side, prices appear to be surging for certain commodities in the face of slower growth.”

The 10 industries reporting growth in March — listed in order — are: Apparel, Leather & Allied Products; Miscellaneous Manufacturing; Wood Products; Transportation Equipment; Plastics & Rubber Products; Chemical Products; Fabricated Metal Products; Food, Beverage & Tobacco Products; Nonmetallic Mineral Products; and Textile Mills.

What Respondent are Saying: ...

"Slowdown evident, could be based on inventory in the channel." (Computer & Electronic Products)

"Industry preparing customers for price increases related to corn/grain cost increases." (Food, Beverage & Tobacco Products)

"Raw material cost soared due to the largest one-month price increase for ferrous scrap since September of 2005." (Primary Metals)

"General business conditions show significant signs of slowing in the manufacturing sector." (Transportation Equipment)

"Business is slowing, but we are slightly ahead of last year's sales. We are projecting a flat year in sales for 2007." (Furniture & Related Products)