Economic activity in U.S. manufacturing grew in the month of October, marking expansion in the overall economy for the 17th consecutive month. The Institute for Supply Management’s October Manufacturing PMI was 60.8%, a 0.3% decrease from September’s 61.1%. Anything over 50% indicates growth.
The food, beverage, and tobacco products sector was one of the 16 manufacturing industries to report growth in October. This is in spite of continued obstacles including the movement of the Imports Index into contraction territory as well as increasing demand, hiring challenges, and labor turnover. The prices index went from 81.2 to 85.7, an increase of 4.5 percentage points. Many tracked commodities reported an increase in price, while several, including temporary labor, remain in short supply. The food, beverage, and tobacco industry was one of six reporting a decrease in employment in October.
“Import costs and delays hurting business, requiring more safety stock for uncertainty. Rolling blackouts in China starting to hurt shipments even more,” one industry respondent commented.
ISM Chair Timothy R. Fiore said that companies are dealing with an “unprecedented” number of hurdles to meet an increasing demand. This includes lead times for raw materials that are record-long and rising commodities prices as well as a shortage of critical materials. On a positive note, panel sentiment remains “strongly optimistic,” with four positive growth comments for every cautious one.
