U.S. Manufacturing Expands in April for 21st Consecutive Month
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Economic activity in the U.S. manufacturing sector expanded in April for the twenty first consecutive month, and the overall economy grew for the twenty third consecutive month, according to the nation's supply executives in the latest Manufacturing ISM Report On Business. The report was issued this week by Norbert J. Ore, chair of the Institute for Supply Management Manufacturing Business Survey Committee, Tempe, Ariz., USA.
The recent trend of rapid growth in the manufacturing sector continued in April as the PMI registered above 60% for the fourth consecutive month. The New Orders and Production Indexes continue to drive the PMI, as they have both exceeded 60% for five consecutive months. Manufacturing employment appears to have developed significant momentum, as the Employment Index readings for the first four months of 2011 are the highest readings in the past 38 years.
Inventory growth also occurred in April after two months of destocking. "However, the inventory restocking would appear to be necessitated by the strong performance in new orders," the report notes. "While the manufacturing sector is definitely performing above most expectations so far in 2011, manufacturers are experiencing significant cost pressures from commodities and other inputs," it continues.
Of the 18 manufacturing industries, 17 are reporting growth in April, in the following order: Wood Products; Plastics & Rubber Products; Primary Metals; Transportation Equipment; Fabricated Metal Products; Computer & Electronic Products; Apparel, Leather & Allied Products; Machinery; Textile Mills; Paper Products; Electrical Equipment, Appliances & Components; Nonmetallic Mineral Products; Miscellaneous Manufacturing; Food, Beverage & Tobacco Products; Chemical Products; Printing & Related Support Activities; and Petroleum and Coal Products. Furniture & Related Products was the only industry reporting contraction in April.
ISM's Employment Index registered 62.7% in April, which is a 0.3 percentage point lower than the 63% reported in March. This is the nineteenth consecutive month of growth in manufacturing employment. An Employment Index above 50.1%, over time, is generally consistent with an increase in the Bureau of Labor Statistics (BLS) data on manufacturing employment.
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