Purchasing Managers' Index Rose to 49.3% in December

Tempe, AZ, January 3, 2025-The Manufacturing Purchasing Managers’ Index (PMI) registered 49.3% in December, 0.9 percentage point higher compared to the 48.4% recorded in November, say the nation's supply executives in the latest Manufacturing ISM Report On Business. 

The overall economy continued in expansion for the 56th month after one month of contraction in April 2020. (A Manufacturing PMI above 42.5%, over a period of time, generally indicates an expansion of the overall economy.) 

The New Orders Index continued in expansion territory for the second month after seven months of contraction, strengthening to 52.5%, 2.1 percentage points higher than the 50.4% recorded in November. 

The December reading of the Production Index (50.3%) is 3.5 percentage points higher than November’s figure of 46.8%. The index returned to expansion after six months in contraction. 

The Prices Index continued in expansion (or ‘increasing’) territory, registering 52.5%, up 2.2 percentage points compared to the reading of 50.3% in November. 

The Backlog of Orders Index registered 45.9%, up 4.1 percentage points compared to the 41.8% recorded in November. 

The Employment Index registered 45.3%, down 2.8 percentage points from November’s figure of 48.1%.

The Supplier Deliveries Index indicated marginally slower deliveries, registering 50.1%, 1.4 percentage points higher than the 48.7% recorded in November. (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 48.4%, up 0.3 percentage point compared to November’s reading of 48.1%.

The New Export Orders Index’s ‘unchanged’ reading of 50% is 1.3 percentage points higher than the 48.7% registered in November. The Imports Index remained in contraction territory in December, registering 49.7%, 2.1 percentage points higher than November’s reading of 47.6%.

The seven manufacturing industries reporting growth in December-listed in order-are primary metals; electrical equipment, appliances & components; wood products; furniture & related products; paper products; miscellaneous manufacturing; and plastics & rubber products. The seven industries reporting contraction in December-in the following order-are textile mills; fabricated metal products; printing & related support activities; machinery; chemical products; transportation equipment; and nonmetallic mineral products.