Economic activity in manufacturing continued to grow for the tenth consecutive month in October, according to the Institute for Supply Management (ISM) Manufacturing Purchasing Managers’ Index (PMI) Report.

The economic indicator grew by one percentage point to 55.5% in October. A percentage over 50% indicates expansion.

The subindexes performed as follows:

• New Orders increased expanded by 0.2% percentage points to 55.5%.
• Production increased by 2.3% percentage points to 59%.
• Prices decreased by 2.7% percentage points to 75.2%. 
• Backlog of Orders decreased 1.8% percentage points to 54.6%. 
• Employment decreased 0.3% percentage points to 52.4%. 
• Supplier Deliveries increased 0.1% percentage points to 59.1%. (The supplier deliveries subindex is inverse, with a score of higher than 50% indicating slower deliveries.)

“In October, general sentiment got worse for a third month in a row, with 34% of the comments positive and 66% negative (a 1-to-2 ratio of positive to negative sentiment),” said Susan Spence, chair of the Institute for Supply Management Manufacturing Business Survey Committee, in a prepared statement. “Among negative comments, pricing volatility was mentioned in 62%, longer lead times 41%, tariffs 25% and the Iran war 21%; most comments mentioned multiple factors.”

In manufacturing, 6% of the sector’s GDP contracted in October, an increase from 2% in September.

ISM also collects comments during their survey. Many respondents left comments reflecting inflation, U.S. tariffs, global tensions and overall economic uncertainty. High diesel rates have also sharply increased operating costs. 

“Economic policies coming out of Washington continue to weigh on business conditions,” said an anonymous fabricated metal products professional. “Customers are unwilling to make commitments to anything other than the short term due to the vast uncertainty.”

Others say demand is high and the supply chain stable.