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Manufacturers report an increase in purchase orders

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Manufacturing activity jumped in December, signaling growth in the sector for a fifth consecutive month, CNNMoney.com reported.

The Tempe, Ariz.-based Institute for Supply Management’s (ISM) index of U.S. manufacturing rose to 55.9 from 53.6 in November. This is the highest level since April 2006, when the index climbed to 56.

The reading beat estimates from economists, who expected the index to jump to 54.3, according to a consensus compiled by Briefing.com.

Levels higher than 50 signal manufacturing growth, and readings below 50 indicate contraction.

“Overall, the recovery in manufacturing is continuing, but there are still some industries mired in the downturn,” said Norbert Ore, chair of the ISM’s manufacturing business survey committee.

Of the 18 manufacturing divisions reporting, seven posted contraction — including categories such as wood products, plastics and rubber, and chemical products. Sectors reporting growth included apparel, computer and electronic products, furniture, transportation equipment and paper products.

The monthly report surveys ISM members, who are purchasing managers in the manufacturing industry. An index above 41.2 implies expansion in the overall economy, making December the eighth consecutive month of economic growth.

The ISM tracks new orders, production, employment, supplier deliveries, inventories, customers’ inventories, the backlog of orders, prices, new export orders, imports and buying policies.