“Very difficult to hire skilled and unskilled labor.” That’s the representative quote from food, beverage, and tobacco industry respondents in the May 2018 ISM report. Employment challenges were also top of mind in March and April, when respondents specifically highlighted the difficulty of finding delivery drivers.

Despite these employment constraints, the food and beverage industry — along with the manufacturing sector and the overall economy — reported growth last month. The Purchasing Managers Index for May was 58.7%, up 1.4% percentage points from the previous month. That makes May the 21st consecutive month of growth for manufacturing, and the 109th consecutive month of growth in the overall economy.

Here’s what the food, beverage, and tobacco industry reported for May:

  • Growth in new orders
  • Growth in production
  • Growth in employment
  • Slower supplier deliveries
  • No change in raw materials inventories
  • Customer inventories too low
  • Increased prices for raw materials
  • Growth in order backlogs
  • No change in new export orders
  • No change in imports

May also saw increases in the average lead times for capital expenditures and maintenance, repair, and operating (MRO) supplies, while average lead time for production materials increased.

Overall, the food and beverage industry continues to be strong, as does the entire manufacturing sector. But that just makes the employment challenges all the more important to solve.

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