US Manufacturing Index Slips to 56.6 in November

US Manufacturing Index Slips to 56.6 in November

Expansion in the manufacturing sector slowed in November, according to the Institute for Supply Management’s manufacturing index, which slipped to 56.6 from 56.9 a month earlier as factory inventories grew and backlogs declined.

The index is closely watched by the transportation industry for trends in supply of materials and demand for shipments of finished goods. November marked the 19th straight month the index was above 50, indicating expansion.

All index components except customers’ inventories and order backlogs remained in positive territory, indicating growth. Customers’ inventories registered 45.5, compared with 44 in October, while backlogs held steady at 46, indicating a steady rate of contraction.

By The Numbers: JOC-ECRI Industrial Price Index.

Growth in new orders slowed to 56.6 from 58.9 in October but was above 50 for the 17th straight month. The index’s production component fell to 55 from 57.7, and employment edged down to 57.5 from 57.7.

The index showed a significant slowing in delivery times, with a reading of 57.2, up from 51.2 in October. It was the 18th consecutive month the supplier deliveries index was above 50, indicating slower deliveries. In another sign of manufacturing activity, input prices registered 69.5, putting that reading above 50 for the 17th consecutive month.

Of the 18 manufacturing industries surveyed in the report, 10 reported growth in the following order: computer and electronic products; petroleum and coal; apparel, leather and allied products; machinery; fabricated metals; plastics and rubber; transportation equipment; electrical equipment; appliances and components; chemicals and primary metals.

Showing contraction were printing and related industries; furniture; food, beverage and tobacco; nonmetallic mineral products; paper and miscellaneous manufacturing.

The November index by Tempe, Ariz.-based ISM came as separate indexes showed manufacturing growth in China and Europe.

China’s manufacturing grew at a faster pace for a fourth straight month in November. The China Purchasing Managers’ Index rose to 55.2, a seven-month high, from 54.7 in October, China’s logistics federation reported.

In Europe, manufacturing expanded at the fastest pace in four months in November, led by Germany, the region’s largest economy. A gauge of manufacturing in the 16-nation euro area rose to 55.3 from 54.6 in October, London-based Markit Economics said.

-- Contact Joseph Bonney at jbonney@joc.com.