Manufacturing sector remains sluggish at start of new year

05/02/2016

Overall, January 2016 remained in "contracting" territory, according to the Institute for Supply Management's (ISM) Manufacturing Report on Business. However, there are a few signs of improvement mixed in with continued contraction in some areas. The January Purchasing Management Index (PMI) ticked up 0.2% to 48.2% from the December 2015 PMI of 48%, but that is still below the benchmark of 50.

The New Orders Index jumped into the growth area, up 2.7% to 51.5% for January. Production also moved onto the "growing" side of the benchmark to 50.2, up 0.3% from December's 49.9. The Employment Index dropped further from December's 48%, falling in January to 45.9%.

Supplier deliveries are virtually unchanged at 50 in January from December's 49.8%. Inventories remained unchanged in the "contracting" mode at 43.5%. Customer Inventories also remained steady but too high at 51.5%.
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