U.S. manufacturing activity continues to slow

Jan. 11, 2023
After 29 months of expansion, U.S. manufacturing contracted in December for the second consecutive month.

According to the most recent Manufacturing ISM Report On Business, manufacturing in the United States is declining. After 29 months of expansion, U.S. manufacturing contracted in December for the second consecutive month. The report states that activity in the manufacturing sector fell by 0.6 percentage points last month, generating a PMI of 48.4%. The New Orders Index decreased by 2 percentage points, while the Production Index fell 3 percentage points.

In a recent quote, Timothy R. Fiore, Chair of the Institute for Supply Management Manufacturing Business Survey Committee, said, "Manufacturing contracted again in December after expanding for 29 straight months. Panelists' companies continue to judiciously manage hiring. The month-over-month performance of supplier deliveries was the best since March 2009. Average lead time remained 32 percent above previous trough for capital expenditures and 37 percent for purchased materials; both are too high. Managing head counts and total supply chain inventories remain primary goals as the sector closes the year. More attention will be paid to demand as we enter the first quarter to shore up order books for the next six to 12 months."

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