Economic activity in U.S. manufacturing grew in December, marking the 19th consecutive month of growth according to the latest Manufacturing ISM® Report on Business®. The December Manufacturing PMI® was 58.7%, down from November’s 61.1% (anything over 50% indicates growth).
The food, beverage, and tobacco products sector was one of the 15 manufacturing industries that reported growth in December. This growth took place in spite of material shortages and pandemic-related global issues, among other factors, which continue to impact manufacturing.
The prices index went from 82.4% in November to 68.2% in December, a decrease of 14.2 percentage points. Several commodities are in short supply, with temporary labor on this list for the eighth consecutive month. The food, beverage, and tobacco products industry was one of five industries reporting a decrease in employment in December. “Labor is still tight, and turnover continues. Supply chain issues are is [sic] still causing customer order cuts. Trucks are scarce, and the teams are burned out from working long hours and dealing with supply constraints daily,” one industry respondent said.
ISM Chair Timothy R. Fiore commented that “shortages of critical lowest-tier materials, high commodity prices and difficulties in transporting products continue to plague reliable consumption.” In addition, “pandemic-related global issues — worker absenteeism, short-term shutdowns due to parts shortages, employee turnover and overseas supply chain problems — continue to impact manufacturing.” However, he also noted that “panel sentiment remains strongly optimistic, with six positive growth comments for every cautious comment.”
