[ad_1]
Manufacturing activity remained higher in November despite headwinds, according to the Institute for Supply Management. The ISM Purchasing Managers Index fell 1.8 points to 57.5% in November from the October PMI of 59.3%.
New orders, production, prices, inventories and imports continued to grow in November, but at a slower pace than in October. The new orders index fell 2.8 points to 65.1%, the production index fell 2.2 points to 60.8%, the inventory index fell 0.7 points to 51.2%, and imports fell 3 , 0 points to 55.1%. The price growth rate remained stable, falling just 0.1 points to 65.4%.
Meanwhile, two indices, order backlog and new export orders, increased at a faster rate than in October. The order book index rose 1.2 points to 56.9% and the new export orders index rose 2.1 points to 57.8%.
Manufacturing employment returned to contraction after expanding in October, when it snapped a 14-month contraction streak: in November, the ISM manufacturing employment index fell 4.8 points to 48.4%. In a statement, Timothy Fiore, president of the ISM, said absenteeism and difficulties in returning and hiring workers were a limiting factor for manufacturing growth.
The speed of supplier deliveries fell for the thirteenth consecutive month at a faster rate than in previous months.
Of the 18 manufacturing industries surveyed, 16 reported growth, with apparel and leather, non-metallic mineral products, and textile factories reporting the strongest growth. Oil and print-related manufacturers posted a contraction.
Multiple responses to the survey indicated that the ongoing COVID-19 pandemic, which is currently experiencing its largest increase yet, is putting pressure on supplier labor demands. A transportation equipment industry executive noted: “The resurgence of COVID-19 cases is adding pressure to our Tier-1 and Tier-2 suppliers. Several vendors mentioned that meeting new people is a problem with the COVID-19 situation. ”
A member of the food and beverage industry said they had to shut down production lines due to understaffing after sending employees home for 14 days to quarantine. Executives in the electronics and plastics industries also complained that their suppliers were suffering from a labor shortage.
In addition to supplier labor, personal protective equipment continues to be in short supply, particularly gloves: the ISM reports that PPE gloves have been listed as “in short supply” for 9 months. Other commodity manufacturers that have trouble sourcing are aluminum products, corrugated boxes, sanitizers, electrical components, PPE masks, hot rolled steel, and steel products. Aluminum and steel products, as well as electrical components, have been listed as in short supply for 2 months.
“Manufacturing performed well for the sixth month in a row, with demand, consumption and inputs registering growth, but at slower rates compared to October. Labor market difficulties, both current and anticipated, in the panelists’ companies and their suppliers will continue to hold back the manufacturing economy until the coronavirus (COVID-19) crisis ends, ”says Fiore.
