Manufacturing activity grew slightly in July, but the ISM Manufacturing Managers’ Index fell from June, owing to rising raw materials costs and a hazy economic future, according to the Institute for Supply Management.
Some of the numbers: The index edged down to 52.8 from 53.0 in June, the lowest reading in more than two years. (Any number above 50 signifies growth, however.) Other manufacturing data:
- New orders decreased to 48.0 from 49.2, declining for the second straight month.
- Production dipped to 53.6 from 54.2 but continued to grow overall despite challenges.
The bright spots: While respondents cited the difficulty in finding workers as a business challenge, hiring in the sector stabilized to near neutral, up to 49.9 from 47.3.
- Prices decelerated to their lowest level since September 2020.
- Exports improved, too, landing at 52.6 from 50.7 a month earlier.
- The index for supplier deliveries, which was down to 55.2 from 57.3, had its best reading in two years, which shows that long wait times have begun to pick up speed. (This index is inversed, with a higher reading indicating slower deliveries.)
The NAM says: “Overall, these data reflect some resilience in the manufacturing sector, even as sentiment has weakened to two-year lows, consistent with other surveys,” NAM Chief Economist Chad Moutray said.
- “Manufacturers remained challenged by supply chains, workforce shortages, soaring costs and geopolitical uncertainties.”