Manufacturing PMI® at 57.6%; January 2022 Manufacturing ISM® Report On Business®

New Orders, Production and Employment Growing; Supplier Deliveries Slowing at a Slower Rate; Backlog Growing; Raw Materials Inventories Growing; Customers' Inventories Too Low; Prices Increasing; Exports and Imports Growing

This report reflects the recently completed annual adjustments to the seasonal factors used to calculate the indexes.

TEMPE, Ariz., Feb. 1, 2022 /PRNewswire/ -- Economic activity in the manufacturing sector grew in January, with the overall economy achieving a 20th consecutive month of growth, say the nation's supply executives in the latest Manufacturing ISM^® Report On Business^®.

The report was issued today by Timothy R. Fiore, CPSM, C.P.M., Chair of the Institute for Supply Management^® (ISM^®) Manufacturing Business Survey Committee:

"The January Manufacturing PMI^® registered 57.6 percent, a decrease of 1.2 percentage points from the seasonally adjusted December reading of 58.8 percent. This figure indicates expansion in the overall economy for the 20th month in a row after a contraction in April and May 2020. The New Orders Index registered 57.9 percent, down 3.1 percentage points compared to the seasonally adjusted December reading of 61 percent. The Production Index registered 57.8 percent, a decrease of 1.6 percentage points compared to the seasonally adjusted December reading of 59.4 percent. The Prices Index registered 76.1 percent, up 7.9 percentage points compared to the December figure of 68.2 percent. The Backlog of Orders Index registered 56.4 percent, 6.4 percentage points lower than the December reading of 62.8 percent. The Employment Index registered 54.5 percent, 0.6 percentage point higher compared to the seasonally adjusted December reading of 53.9 percent. The Supplier Deliveries Index registered 64.6 percent, down 0.3 percentage point from the December figure of 64.9 percent. The Inventories Index registered 53.2 percent, 1.4 percentage points lower than the seasonally adjusted December reading of 54.6 percent. The New Export Orders Index registered 53.7 percent, up 0.1 percentage point compared to the December reading of 53.6 percent. The Imports Index registered 55.1 percent, a 1.3-percentage point increase from the December reading of 53.8 percent."

Fiore continues, "The U.S. manufacturing sector remains in a demand-driven, supply chain-constrained environment, but January was the third straight month with indications of improvements in labor resources and supplier delivery performance. Still, there were shortages of critical intermediate materials, difficulties in transporting products and lack of direct labor on factory floors due to the COVID-19 omicron variant. Quits rate and early retirements hinder reliable consumption. Panel sentiment remains strongly optimistic, with seven positive growth comments for every cautious comment, up from December's ratio of 6-to-1. Demand expanded, with the (1) New Orders Index slowing but remaining in strong growth territory, supported by continued expansion of new export orders, (2) Customers' Inventories Index remaining at a very low level and (3) Backlog of Orders Index slowing but settling at more normal growth levels. Consumption (measured by the Production and Employment indexes) grew during the period, though at a slower rate, with a combined negative 1-percentage point change to the Manufacturing PMI^® calculation. The Employment Index expanded for a fifth straight month, with signs that ability to hire continues to improve, though somewhat offset by continued challenges of turnover (quits and retirements) and resulting backfilling. Limited expansion strength in production in January, primarily due to absenteeism rates as a result of omicron, was the biggest reason PMI^® growth was held back. Inputs — expressed as supplier deliveries, inventories, and imports — continued to constrain production expansion, but there are clear indications of improved delivery performance. The Supplier Deliveries Index again slowed while the Inventories Index expanded, both at a slower rate. In January, the Prices Index increased for the 20th consecutive month, at a faster rate (an increase of 7.9 percentage points) compared to December, indicating that supplier pricing power continues to rise.

"All of the six biggest manufacturing industries — Machinery; Food, Beverage & Tobacco Products; Transportation Equipment; Computer & Electronic Products; Chemical Products; and Petroleum & Coal Products, in that order — registered moderate to strong growth in January.

"Manufacturing performed well for the 20th straight month, with demand and consumption registering month-over-month growth. Meeting demand remains a challenge, due to hiring difficulties and labor turnover at all tiers. For the third month in a row, Business Survey Committee panelists' comments suggest month-over-month improvement on hiring, offset by backfilling required to address employee turnover at a higher rate, supplier performance and improvements in the transportation sector," says Fiore.

The 14 manufacturing industries reporting growth in January — in the following order — are: Apparel, Leather & Allied Products; Furniture & Related Products; Miscellaneous Manufacturing; Nonmetallic Mineral Products; Machinery; Electrical Equipment, Appliances & Components; Food, Beverage & Tobacco Products; Transportation Equipment; Primary Metals; Fabricated Metal Products; Computer & Electronic Products; Chemical Products; Petroleum & Coal Products; and Plastics & Rubber Products. The only industry reporting a decrease in January compared to December is Paper Products.

WHAT RESPONDENTS ARE SAYING

• "We are experiencing massive interruptions to our production due to supplier COVID-19 problems limiting their manufacturing of key raw (materials) like steel cans and chemicals." [Chemical Products]
• "While there has been some improvement in materials making it to our factories and logistics centers, we are still constrained by (a lack of) qualified labor. Orders so far are not being cancelled, but we are concerned that customers may be losing patience." [Computer & Electronic Products]
• "Transportation, labor and inflation issues continue to hamper our supply chain and ability to service our customers. Fortunately, it's also hampering our competition as well. Ultimately, the biggest impact is at the consumer level, as (price increases) continue to get passed through." [Transportation Equipment]
• "Our suppliers are having difficulty meeting scheduled releases as their suppliers experience delays and shortages, so lead times and inventories are struggling, resulting in lost production." [Food, Beverage & Tobacco Products]
• "Lack of skilled production personnel, either from missing work due to (COVID-19) variants or leaving for better opportunities, making it more difficult to complete work. Working off a backlog." [Fabricated Metal Products]
• "Strong backlog of orders coming into the new year. Potential to beat target revenue, depending on availability of purchased product." [Electrical Equipment, Appliances & Components]
• "Bookings continue to increase as we are still dealing with a shortage of labor and supply chain issues." [Furniture & Related Products]
• "Transportation restrictions and a lack of supplier manpower continue to create significant shortages that limit our production. This, in turn, limits what we can supply to customers, as well as on-time delivery." [Machinery]
• "Integrated circuit availability is really causing issues. Shortages of raw materials and other electronic materials continue to hamper deliveries to our customers." [Miscellaneous Manufacturing]
• "The supply chain crunch may be loosening a bit; however, specific original equipment manufacturer (OEM) parts and equipment now have lead times that we have not experienced before." [Nonmetallic Mineral Products]

Manufacturing ISM^® Report On Business^® data is seasonally adjusted for the New Orders, Production, Employment and Inventories indexes.
*Number of months moving in current direction.
Indexes reflect newly released seasonal adjustment factors.

COMMODITIES REPORTED UP/DOWN IN PRICE AND IN SHORT SUPPLY

Commodities Up in Price
Adhesives and Paint (2); Aluminum (20); Aluminum Products; Calcium Carbonate; Caustic; Copper; Corrugated Packaging (15); Crude Oil*; Diesel Fuel (13); Electrical Components (14); Electronic Assemblies; Electronic Components (14); Freight (15); Hydraulic Components; Labor — Temporary (9); Lubricants (2); Lumber (2); Lumber — Pallets; Natural Gas* (7); Ocean Freight (14); Packaging Film; Packaging Supplies (14); Paper Products; Plastic Resins; Resin Based Products (12); Ridged Plastic Packaging Products; Rubber Based Products (6); Semiconductors (12); Soy Based Products; Steel* (18); Steel — Hot Rolled*; Steel — Stainless (15); Steel Drums; Steel Products* (17); Vegetable Based Oils; and Zinc Compounds.

Commodities Down in Price
Crude Oil* (2); Natural Gas* (2); Plastic Resins; Steel* (3); Steel — Carbon; Steel — Hot Rolled* (3); Steel — Scrap; and Steel Products*.

Commodities in Short Supply
Aluminum (3); Aluminum Products; Brass; Caustic; Corrugate; Electrical Components (16); Electronic Components (14); Epoxy; Labor — Temporary (9); Ocean Freight; Paper; Plastic Resins — Other (11); Printed Circuit Board Assemblies; Ridged Plastic Packaging Products; Semiconductors (14); and Steel Products.

Note: The number of consecutive months the commodity is listed is indicated after each item.
*Indicates both up and down in price.

JANUARY 2022 MANUFACTURING INDEX SUMMARIES

Manufacturing PMI^®
Manufacturing grew in January, as the Manufacturing PMI^® registered 57.6 percent, 1.2 percentage points lower than the seasonally adjusted December reading of 58.8 percent. "The Manufacturing PMI^® continued to indicate strong sector expansion and U.S. economic growth in January. All five subindexes that directly factor into the Manufacturing PMI^® were in growth territory. All of the six biggest manufacturing industries expanded, in the following order: Machinery; Food, Beverage & Tobacco Products; Transportation Equipment; Computer & Electronic Products; Chemical Products; and Petroleum & Coal Products. The New Orders and Production indexes remained at strong levels. The Supplier Deliveries Index slightly softened but continued to reflect suppliers' difficulties in maintaining delivery rates. All 10 of the subindexes were positive for the period; a reading of 'too low' for the Customers' Inventories Index is considered a positive for future production," says Fiore. A reading above 50 percent indicates that the manufacturing economy is generally expanding; below 50 percent indicates that it is generally contracting.

A Manufacturing PMI^® above 48.7 percent, over a period of time, generally indicates an expansion of the overall economy. Therefore, the January Manufacturing PMI^® indicates the overall economy grew in January for the 20th consecutive month following contraction in April and May 2020. "The past relationship between the Manufacturing PMI^® and the overall economy indicates that the Manufacturing PMI^® for January (57.6 percent) corresponds to a 3.1-percent increase in real gross domestic product (GDP) on an annualized basis," says Fiore.

THE LAST 12 MONTHS

New Orders
ISM^®'s New Orders Index registered 57.9 percent in January, a decrease of 3.1 percentage points compared to the seasonally adjusted 61 percent reported in December. This indicates that new orders grew for the 20th consecutive month. "Five of the six largest manufacturing sectors — Food, Beverage & Tobacco Products; Computer & Electronic Products; Transportation Equipment; Machinery; and Chemical Products — expanded at moderate to strong levels," says Fiore. A New Orders Index above 52.9 percent, over time, is generally consistent with an increase in the Census Bureau's series on manufacturing orders (in constant 2000 dollars).

Eleven of 18 manufacturing industries reported growth in new orders in January, in the following order: Apparel, Leather & Allied Products; Furniture & Related Products; Primary Metals; Fabricated Metal Products; Food, Beverage & Tobacco Products; Computer & Electronic Products; Electrical Equipment, Appliances & Components; Transportation Equipment; Plastics & Rubber Products; Machinery; and Chemical Products. The two industries reporting a decline in new orders in January are: Textile Mills; and Petroleum & Coal Products.

Production
The Production Index registered 57.8 percent in January, 1.6 percentage points lower than the seasonally adjusted December reading of 59.4 percent, indicating growth for the 20th consecutive month. "Four of the top six industries — Machinery; Transportation Equipment; Chemical Products; and Food, Beverage & Tobacco Products — expanded at moderate to strong levels. Shortages of raw materials and labor (due to omicron-fueled unplanned absenteeism) are a constraint to production growth at respondents' companies. Panelist sentiment on labor and material shortages, however, improved for a third month in spite of COVID-19 obstacles," says Fiore. An index above 52.4 percent, over time, is generally consistent with an increase in the Federal Reserve Board's Industrial Production figures.

The 10 industries reporting growth in production during the month of January — listed in order — are: Furniture & Related Products; Primary Metals; Wood Products; Fabricated Metal Products; Machinery; Transportation Equipment; Miscellaneous Manufacturing; Electrical Equipment, Appliances & Components; Chemical Products; and Food, Beverage & Tobacco Products. The three industries reporting a decrease in January are: Apparel, Leather & Allied Products; Textile Mills; and Computer & Electronic Products.

Employment
ISM^®'s Employment Index registered 54.5 percent in January, 0.6 percentage point above the seasonally adjusted December reading of 53.9 percent. "The index reported a fifth consecutive month of expansion. Of the six big manufacturing sectors, five (Petroleum & Coal Products; Machinery; Food, Beverage & Tobacco Products; Transportation Equipment; and Computer & Electronic Products) expanded. Survey panelists' companies are still struggling to meet labor-management plans, but for a fifth month, there were modest signs of progress: An increasing share of comments (11 percent in January, up from 7 percent in December) noted greater hiring ease. An overwhelming majority of panelists again indicate their companies are increasing head counts or attempting to, as 84 percent of Employment Index comments were hiring focused. Among those respondents, 31 percent expressed difficulty in filling positions, down from 37 percent in December. Rising concerns regarding turnover rates (44 percent cited backfills and retirements, an increase from 32 percent in December) continued a trend that began in August," says Fiore. An Employment Index above 50.5 percent, over time, is generally consistent with an increase in the Bureau of Labor Statistics (BLS) data on manufacturing employment.

Of 18 manufacturing industries, nine industries reported employment growth in January, in the following order: Apparel, Leather & Allied Products; Miscellaneous Manufacturing; Electrical Equipment, Appliances & Components; Petroleum & Coal Products; Machinery; Furniture & Related Products; Food, Beverage & Tobacco Products; Transportation Equipment; and Computer & Electronic Products. The five industries reporting a decrease in employment in January are: Paper Products; Primary Metals; Nonmetallic Mineral Products; Chemical Products; and Plastics & Rubber Products.

Supplier Deliveries^†
The delivery performance of suppliers to manufacturing organizations was slower in January, as the Supplier Deliveries Index registered 64.6 percent, 0.3 percentage point lower than the 64.9 percent reported in December. All of the six top manufacturing industries (Food, Beverage & Tobacco Products; Computer & Electronic Products; Machinery; Transportation Equipment; Petroleum & Coal Products; and Chemical Products, in that order) reported slowing deliveries. "Deliveries slowed at a slightly slower rate compared to the previous month. The index continues to reflect suppliers' difficulties in meeting demand from panelist companies, as the omicron variant swept through suppliers and the transportation sector, reversing a trend of improvement that began in November. Suppliers are expected to be back on track in February, moving toward a better supply-and-demand balance in March. Capital Expenditures lead times continue at modern-era records. After 5-percent improvement from the previous month was erased in January, lead times for Production Materials remain at near-record levels," says Fiore. (For more data on lead times, see the Buying Policy section.) A reading below 50 percent indicates faster deliveries, while a reading above 50 percent indicates slower deliveries.

Sixteen of 18 industries reported slower supplier deliveries in January, in the following order: Apparel, Leather & Allied Products; Nonmetallic Mineral Products; Miscellaneous Manufacturing; Paper Products; Textile Mills; Food, Beverage & Tobacco Products; Computer & Electronic Products; Machinery; Transportation Equipment; Petroleum & Coal Products; Chemical Products; Primary Metals; Fabricated Metal Products; Plastics & Rubber Products; Electrical Equipment, Appliances & Components; and Furniture & Related Products. The only industry reporting faster supplier deliveries in January as compared to December is Wood Products.

Inventories
The Inventories Index registered 53.2 percent in January, 1.4 percentage points lower than the seasonally adjusted 54.6 percent reported for December. "Manufacturing inventories continued to expand but at a slower rate. Due to supplier labor and transportation issues in January, the end-of-year inventory draw down that occurred in December could not be fully replenished. Inventories Index readings are expected to improve in February and March," says Fiore. An Inventories Index greater than 44.4 percent, over time, is generally consistent with expansion in the Bureau of Economic Analysis (BEA) figures on overall manufacturing inventories (in chained 2000 dollars).

The 12 industries reporting higher inventories in January — in the following order — are: Apparel, Leather & Allied Products; Nonmetallic Mineral Products; Furniture & Related Products; Textile Mills; Miscellaneous Manufacturing; Transportation Equipment; Primary Metals; Machinery; Electrical Equipment, Appliances & Components; Computer & Electronic Products; Fabricated Metal Products; and Chemical Products. Only Paper Products reported contracting inventories in January.

Customers' Inventories^†
ISM^®'s Customers' Inventories Index registered 33 percent in January, 1.3 percentage points higher than the 31.7 percent reported for December, indicating that customers' inventory levels were considered too low. "Customers' inventories are too low for the 64th consecutive month, a positive for future production growth. For 18 straight months, the Customers' Inventories Index has been at historically low levels," says Fiore.

No industries reported higher customers' inventories in January. The 11 industries reporting customers' inventories as too low during January — listed in order — are: Apparel, Leather & Allied Products; Fabricated Metal Products; Paper Products; Machinery; Transportation Equipment; Miscellaneous Manufacturing; Chemical Products; Furniture & Related Products; Computer & Electronic Products; Food, Beverage & Tobacco Products; and Primary Metals. Seven industries reported no change in customers' inventories when comparing January's levels to December.

Prices^†
The ISM^® Prices Index registered 76.1 percent, an increase of 7.9 percentage points compared to the December reading of 68.2 percent, indicating raw materials prices increased for the 20th consecutive month, at a faster rate in January. This is the 17th month in a row that the index has been above 60 percent. "Aluminum; corrugate and packaging materials; copper; electrical and electronic components; petroleum products; vegetable oils; lumber; freight; rubber-based products; and steel products continue to remain at elevated prices due to product scarcity amongst high demand," says Fiore. A Prices Index above 52.6 percent, over time, is generally consistent with an increase in the Bureau of Labor Statistics (BLS) Producer Price Index for Intermediate Materials.

In January, 17 industries reported paying increased prices for raw materials, in the following order: Apparel, Leather & Allied Products; Textile Mills; Nonmetallic Mineral Products; Paper Products; Food, Beverage & Tobacco Products; Furniture & Related Products; Computer & Electronic Products; Miscellaneous Manufacturing; Transportation Equipment; Petroleum & Coal Products; Primary Metals; Chemical Products; Electrical Equipment, Appliances & Components; Machinery; Wood Products; Fabricated Metal Products; and Plastics & Rubber Products. No industry reported paying decreased prices for raw materials.

Backlog of Orders^†
ISM^®'s Backlog of Orders Index registered 56.4 percent in January, a 6.4-percentage point decrease compared to the 62.8 percent reported in December, indicating order backlogs expanded for the 19th straight month. "Backlogs expanded at a slower rate in January; however, the index reading indicates incoming business remains high. The expansion is at its slowest rate since October 2020, when the Backlog of Orders Index registered 55.7 percent — a historically normal level. Five of the six big industry sectors (Food, Beverage & Tobacco Products; Machinery; Transportation Equipment; Chemical Products; and Computer & Electronic Products) reported that backlogs expanded strongly," says Fiore.

The 11 industries reporting growth in order backlogs in January, in the following order, are: Apparel, Leather & Allied Products; Textile Mills; Furniture & Related Products; Fabricated Metal Products; Food, Beverage & Tobacco Products; Machinery; Primary Metals; Miscellaneous Manufacturing; Transportation Equipment; Chemical Products; and Computer & Electronic Products. The two industries reporting lower backlogs in January are: Wood Products; and Nonmetallic Mineral Products.

New Export Orders^†
ISM^®'s New Export Orders Index registered 53.7 percent in January, up 0.1 percentage point compared to the December reading of 53.6 percent. "The New Export Orders Index grew for the 19th consecutive month, at a slightly faster rate in January. Of the six big industry sectors, five (Machinery; Food, Beverage & Tobacco Products; Computer & Electronic Products; Transportation Equipment; and Chemical Products) expanded. Export levels of U.S. manufactured products remain a positive for the U.S. manufacturing economy, as our overseas customers continue to face sluggish growth," says Fiore.

The eight industries reporting growth in new export orders in January — in the following order — are: Miscellaneous Manufacturing; Plastics & Rubber Products; Primary Metals; Machinery; Food, Beverage & Tobacco Products; Computer & Electronic Products; Transportation Equipment; and Chemical Products. The two industries reporting a decrease in new export orders in January are: Wood Products; and Paper Products. Seven industries reported no change in exports in January as compared to December.

Imports^†
ISM^®'s Imports Index registered 55.1 percent in January, an increase of 1.3 percentage points compared to December's figure of 53.8 percent. "Imports expanded in January for the third consecutive month, in spite of continuing challenges with throughput at U.S. ports of entry. Overland transport challenges and container shortages continue to persist across the global supply chain in the buildup prior to Lunar New Year. However, there were signs of improvement in the month of January, based on panelists' comments. Imports will continue to be challenged through the first half of 2022, though, due to the pandemic," says Fiore.

The nine industries reporting growth in imports in January — in the following order — are: Furniture & Related Products; Nonmetallic Mineral Products; Transportation Equipment; Electrical Equipment, Appliances & Components; Miscellaneous Manufacturing; Machinery; Computer & Electronic Products; Food, Beverage & Tobacco Products; and Chemical Products. Two industries — Plastics & Rubber Products; and Fabricated Metal Products — reported lower volumes of imports in January as compared to December. Seven industries reported no change in imports in January.

^†The Supplier Deliveries, Customers' Inventories, Prices, Backlog of Orders, New Export Orders, and Imports indexes do not meet the accepted criteria for seasonal adjustments.

Buying Policy
Average commitment lead time for Capital Expenditures in January was 167 days, an increase of six days compared to December. Capital Expenditures lead times have increased in 10 of the last 12 months for a net increase of 25 days since February 2021 (142 days). Average lead time in January for Production Materials increased by four days to 95 days. Average lead time for Maintenance, Repair and Operating (MRO) Supplies was 46 days, down two days compared to December.

About This Report
DO NOT CONFUSE THIS NATIONAL REPORT with the various regional purchasing reports released across the country. The national report's information reflects the entire U.S., while the regional reports contain primarily regional data from their local vicinities. Also, the information in the regional reports is not used in calculating the results of the national report. The information compiled in this report is for the month of January 2022.

The data presented herein is obtained from a survey of manufacturing supply executives based on information they have collected within their respective organizations. ISM^® makes no representation, other than that stated within this release, regarding the individual company data collection procedures. The data should be compared to all other economic data sources when used in decision-making.

Data and Method of Presentation
The Manufacturing ISM^® Report On Business^® is based on data compiled from purchasing and supply executives nationwide. The composition of the Manufacturing Business Survey Committee is stratified according to the North American Industry Classification System (NAICS) and each of the following NAICS-based industry's contribution to gross domestic product (GDP): Food, Beverage & Tobacco Products; Textile Mills; Apparel, Leather & Allied Products; Wood Products; Paper Products; Printing & Related Support Activities; Petroleum & Coal Products; Chemical Products; Plastics & Rubber Products; Nonmetallic Mineral Products; Primary Metals; Fabricated Metal Products; Machinery; Computer & Electronic Products; Electrical Equipment, Appliances & Components; Transportation Equipment; Furniture & Related Products; and Miscellaneous Manufacturing (products such as medical equipment and supplies, jewelry, sporting goods, toys and office supplies). The data are weighted based on each industry's contribution to GDP. According to the BEA estimates for 2020 GDP (released December 22, 2021), the six largest manufacturing subsectors are: Computer & Electronic Products; Chemical Products; Transportation Equipment; Petroleum & Coal Products; Food, Beverage & Tobacco Products; and Machinery. Beginning in February 2018 with January 2018 data, computation of the indexes is accomplished utilizing unrounded numbers.

Survey responses reflect the change, if any, in the current month compared to the previous month. For each of the indicators measured (New Orders, Backlog of Orders, New Export Orders, Imports, Production, Supplier Deliveries, Inventories, Customers' Inventories, Employment and Prices), this report shows the percentage reporting each response, the net difference between the number of responses in the positive economic direction (higher, better and slower for Supplier Deliveries) and the negative economic direction (lower, worse and faster for Supplier Deliveries), and the diffusion index. Responses are raw data and are never changed. The diffusion index includes the percent of positive responses plus one-half of those responding the same (considered positive).

The resulting single index number for those meeting the criteria for seasonal adjustments (Manufacturing PMI^®, New Orders, Production, Employment and Inventories) is then seasonally adjusted to allow for the effects of repetitive intra-year variations resulting primarily from normal differences in weather conditions, various institutional arrangements, and differences attributable to non-moveable holidays. All seasonal adjustment factors are subject annually to relatively minor changes when conditions warrant them. The Manufacturing PMI^® is a composite index based on the diffusion indexes of five of the indexes with equal weights: New Orders (seasonally adjusted), Production (seasonally adjusted), Employment (seasonally adjusted), Supplier Deliveries, and Inventories (seasonally adjusted).

Diffusion indexes have the properties of leading indicators and are convenient summary measures showing the prevailing direction of change and the scope of change. A Manufacturing PMI^® reading above 50 percent indicates that the manufacturing economy is generally expanding; below 50 percent indicates that it is generally declining. A Manufacturing PMI^® above 48.7 percent, over a period of time, indicates that the overall economy, or gross domestic product (GDP), is generally expanding; below 48.7 percent, it is generally declining. The distance from 50 percent or 48.7 percent is indicative of the extent of the expansion or decline. With some of the indicators within this report, ISM^® has indicated the departure point between expansion and decline of comparable government series, as determined by regression analysis. The Manufacturing ISM^® Report On Business^® survey is sent out to Manufacturing Business Survey Committee respondents the first part of each month. Respondents are asked to report on information for the current month for U.S. operations only. ISM^® receives survey responses throughout most of any given month, with the majority of respondents generally waiting until late in the month to submit responses to give the most accurate picture of current business activity. ISM^® then compiles the report for release on the first business day of the following month.

The industries reporting growth, as indicated in the Manufacturing ISM^® Report On Business^® monthly report, are listed in the order of most growth to least growth. For the industries reporting contraction or decreases, those are listed in the order of the highest level of contraction/decrease to the least level of contraction/decrease.

Responses to Buying Policy reflect the percent reporting the current month's lead time, the approximate weighted number of days ahead for which commitments are made for Capital Expenditures; Production Materials; and Maintenance, Repair and Operating (MRO) Supplies, expressed as hand-to-mouth (five days), 30 days, 60 days, 90 days, six months (180 days), a year or more (360 days), and the weighted average number of days. These responses are raw data, never revised, and not seasonally adjusted since there is no significant seasonal pattern.

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Institute for Supply Management^® (ISM^®) serves supply management professionals in more than 90 countries. Its 50,000 members around the world manage about US$1 trillion in corporate and government supply chain procurement annually. Founded in 1915 as the first supply management institute in the world, ISM is committed to advancing the practice of supply management to drive value and competitive advantage for its members, contributing to a prosperous and sustainable world. ISM leads the profession through the ISM Report On Business^®, its highly regarded certification programs and the ISM Advance^TM Digital Platform. This report has been issued by the association since 1931, except for a four-year interruption during World War II.

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