Manufacturers’ inventories tightened as U.S. factories marked their 10th consecutive month of year-to-year growth, the Institute for Supply Management said today.
The ISM manufacturing index was at 59.7 in May, down from 60.4 in April. New orders, a gauge of future production, were unchanged at 65.7.
A level above 50 indicates expansion.
The inventories index was 45.6 in May, down from 49.4 in April. It was the second consecutive month the index showed tighter inventories. ISM said it received a number or reports, particularly in the technology sector, of component shortages resulting from excessive reduction of inventories during the downturn.
Manufacturers were trying to keep up with a rapid rebound, and the index measuring backlog of manufacturers' orders grew two percentage points to 59.5.
Export orders pushed one percentage point to 62, while imports slipped 1.5 percentage points.
ISM said its employment index, which measures employers' willingness to hire, rose 1.3 percentage points to 59.8, and that manufacturers have added to payrolls for six consecutive months.
Sixteen of the 18 manufacturing industries in the index reported growth during May.