New Orders, Production and Employment Growing; Inventories Growing; Supplier Deliveries Slowing

Economic activity in the manufacturing sector expanded in November for the sixth consecutive month, and the overall economy grew for the 54th consecutive month, say the nation's supply executives in the latest Manufacturing ISM Report on Business.

The PMI* registered 57.3 percent, an increase of 0.9 percentage point from October's reading of 56.4 percent. The PMI has increased progressively each month since June, with November's reading reflecting the highest PMI in 2013.  The New Orders Index increased in November by 3 percentage points to 63.6 percent, and the Production Index increased by 2 percentage points to 62.8 percent.  The Employment Index registered 56.5 percent.  With 15 of 18 manufacturing industries reporting growth in November relative to October, the positive growth trend characterizing the second half of 2013 is continuing. 

*A PMI in excess of 42.2 percent, over a period of time, generally indicates an expansion of the overall economy.  Therefore, the November PMI indicates growth for the 54th consecutive month in the overall economy, and indicates expansion in the manufacturing sector for the sixth consecutive month.  The past relationship between the PMI and the overall economy indicates that the average PMI for January through November (53.7 percent) corresponds to a 3.6 percent increase in real gross domestic product (GDP) on an annualized basis.  In addition, if the PMI for November (57.3 percent) is annualized, it corresponds to a 4.7 percent increase in real GDP annually.

Source: ISM Report on Business