Manufacturing PMI Falls

Manufacturing PMI at 46.5%, wood products and furniture contract overall

By Dakota Smith

November 1, 2024 | 11:15 am CDT

TEMPE, Ariz. — Economic activity in the manufacturing sector contracted in October for the seventh consecutive month and the 23rd time in the last 24 months, 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 Manufacturing PMI registered 46.5 percent in October, 0.7 percentage point lower compared to the 47.2 percent recorded in September. This is the lowest Manufacturing PMI reading in 2024. The overall economy continued in expansion for the 54th month after one month of contraction in April 2020. (A Manufacturing PMI above 42.5 percent, over a period of time, generally indicates an expansion of the overall economy.)

Fiore continues, “U.S. manufacturing activity contracted again in October, and at a faster rate compared to last month. Demand continues to be weak, output declined, and inputs stayed accommodative. Demand slowing was reflected by the (1) New Orders Index remaining in contraction territory, (2) New Export Orders Index contracting moderately, (3) Backlog of Orders Index dropping further into strong contraction territory, and (4) Customers’ Inventories Index indicating customers’ inventories were ‘too low.’ Output (measured by the Production and Employment indexes) continued in contraction. 

Wood products and furniture & related products overall manufacturing metrics were not measured in this report. 

Wood products saw a contraction in:

• Inventories

Growth:

• Employment
• Inventories
• Prices for raw materials

A respondant in the wood products industry stated, “The seasonal business cycle is as planned: Consumer confidence in building materials remains relatively strong, and expectations are for continued growth into 2025 due to reduced interest rates and the potential for further small cuts.”

Furniture & related products saw a contraction in: 

• New orders
• Employment
• Supplier deliveries
• Backlogs
• Volumes of imports

Growth:

• Customer inventories

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.

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