Manufacturing sector activity grew in March

Economic activity in the manufacturing sector grew in March for the 34th consecutive month, while the overall economy grew for the 53rd consecutive month, said the nation's supply executives in the latest Manufacturing ISM Report On Business®.

The report was issued today by Norbert J. Ore, C.P.M., chair of the Institute for Supply Management™ Manufacturing Business Survey Committee. "The manufacturing sector, led by continued strength in new orders and production, continued to grow in March. The first quarter is now complete, and the ISM data indicates that it was a good quarter for U.S. manufacturing. Prices are still a major concern, particularly in the energy and metals markets. In general, manufacturing continues to experience a significant level of growth."

The 15 industries reporting growth in March—listed in order—are: Miscellaneous; Apparel; Textiles; Petroleum; Industrial & Commercial Equipment & Computers; Printing & Publishing; Primary Metals; Transportation & Equipment; Wood & Wood Products; Chemicals; Electronic Components & Equipment; Fabricated Metals; Instruments & Photographic Equipment; Food; and Paper.

The PMI indicates that the manufacturing economy grew in March for the 34th consecutive month as it registered 55.2 percent, a decrease of 1.5 percentage points when compared to February's seasonally adjusted reading of 56.7 percent. A reading above 50 percent indicates that the manufacturing economy is generally expanding; below 50 percent indicates that it is generally contracting.

A PMI in excess of 42 percent, over a period of time, generally indicates an expansion of the overall economy. The March PMI indicates that both the overall economy and the manufacturing sector are growing. The past relationship between the PMI and the overall economy indicates that the average PMI for January through March (55.6 percent) corresponds to a 4.7 percent increase in real gross domestic product (GDP). In addition, if the PMI for March (55.2 percent) is annualized, it corresponds to a 4.5 percent increase in real GDP annually.

More information about the ISM report can be found here.