Purchasing Managers' Index Declined to 48.5% in May

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Purchasing Managers' Index Declined to 48.5% in May

Tempe, AZ, June 2, 2025-The Manufacturing Purchasing Managers’ Index (PMI) registered 48.5% in May, 0.2 percentage point lower compared to the 48.7% recorded in April, according to the ISM Report on Business. The overall economy continued in expansion for the 61st month after one month of contraction in April 2020. (A Manufacturing PMI above 42.3%, over a period of time, generally indicates an expansion of the overall economy.) 

The New Orders Index contracted for the fourth month in a row following a three-month period of expansion; the figure of 47.6% is 0.4 percentage point higher than the 47.2% recorded in April. 

The May reading of the Production Index (45.4%) is 1.4 percentage points higher than April’s figure of 44%. The index continued in contraction in March for the third straight month after two months of expansion preceded by eight months of contraction. 

The Prices Index remained in expansion (or ‘increasing’) territory, registering 69.4%, down 0.4 percentage point compared to the reading of 69.8% in April. 

The Backlog of Orders Index registered 47.1%, up 3.4 percentage points compared to the 43.7% recorded in April. 

The Employment Index registered 46.8%, up 0.3 percentage point from April’s figure of 46.5%.

The Supplier Deliveries Index indicated a continued slowing of deliveries, registering 56.1%, 0.9 percentage point higher than the 55.2% recorded in April. (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 registered 46.7%, down 4.1 percentage points compared to April’s reading of 50.8%.

The New Export Orders Index reading of 40.1% is three percentage points lower than the reading of 43.1% registered in April. The Imports Index plunged into extreme contraction in May, registering 39.9%, 7.2 percentage points lower than April’s reading of 47.1%.

The seven manufacturing industries reporting growth in May-listed in order-are plastics & rubber products; nonmetallic mineral products; petroleum & coal products; furniture & related products; electrical equipment, appliances & components; fabricated metal products; and machinery. The seven industries reporting contraction in May, in order, are paper products; wood products; printing & related support activities; food, beverage & tobacco products; transportation equipment; chemical products; and primary metals.