Manufacturing economic activity contracted for the 13th consecutive month in November, according to the Institute for Supply Management’s November 2023 manufacturing sector report. The Purchasing Manager’s Index registered 46.7%, unchanged from the previous month; this reading also indicates a contraction of the overall economy.
“All of the five subindexes that directly factor into the Manufacturing PMI are in contraction territory, up from four in October,” says Timothy Fiore, chair of the ISM’s manufacturing business survey committee.
The production index entered contraction territory, registering 1.9 points lower than October’s 50.4% reading. Anything lower than 50% represents contraction. The employment index also fell, registering 45.8% compared to the 46.8% figure from the previous month. Although remaining in contraction territory, the new orders index saw a 2.8-point increase with a reading of 48.3%.
Three industries out of 17 reported growth in November: food, beverage & tobacco products; nonmetallic mineral products; and transportation equipment.
In the comments of the survey, several respondents note the desire to reduce high inventory levels, some of which were caused by the auto strike. “Automotive sales still impacted by UAW strike. Still waiting for orders to come in, and we also need to work down inventory levels that increased during the strike period. This will most likely happen in December,” notes a respondent in the fabricated metal products industry.