ISM's Purchasing Managers' Index Declined to 46.7% in October

Tempe, AZ, November 1, 2023-The Manufacturing Purchasing Managers’ Index (PMI) registered 46.7% in October, 2.3 percentage points lower than the 49% recorded in September say the nation's supply executives in the latest Manufacturing ISM Report On Business. 

The overall economy dropped back into contraction after one month of weak expansion preceded by nine months of contraction and a 30-month period of expansion before that. (A Manufacturing PMI® above 48.7%, over a period of time, generally indicates an expansion of the overall economy.) 

The New Orders Index remained in contraction territory at 45.5%, 3.7 percentage points lower than the figure of 49.2% recorded in September. 

The Production Index reading of 50.4% is a 2.1-percentage point decrease compared to September’s figure of 52.5%. 

The Prices Index registered 45.1%, up 1.3 percentage points compared to the reading of 43.8% in September. 

The Backlog of Orders Index registered 42.2%, 0.2 percentage point lower than the September reading of 42.4%. 

The Employment Index registered 46.8%, down 4.4 percentage points from the 51.2% reported in September.

The Supplier Deliveries Index figure of 47.7% is 1.3 percentage points higher than the 46.4% recorded in September. (Supplier Deliveries is the only ISM Report On Business index that is inversed; a reading of above 50% indicates slower deliveries, which is typical as the economy improves and customer demand increases.)

The Inventories Index decreased by 2.5 percentage points to 43.3%; the September reading was 45.8%. 

The New Export Orders Index reading of 49.4% is 2 percentage points higher than September’s figure of 47.4%. 

The Imports Index remained in contraction territory, registering 47.9%, 0.3 percentage point lower than the 48.2% reported in September.

The two manufacturing industries that reported growth in October are food, beverage & tobacco products and plastics & rubber products. The 13 industries reporting contraction in October-in the following order-are printing & related support activities; textile mills; electrical equipment, appliances & components; machinery; fabricated metal products; wood products; computer & electronic products; furniture & related products; paper products; miscellaneous manufacturing; primary metals; chemical products; and transportation equipment.