December marked the second consecutive month of contraction for U.S. manufacturing economic activity, according to the recently released Manufacturing ISM® Report on Business®. The manufacturing PMI was 48.4%, slightly down from November’s 49%.
The food, beverage, and tobacco industry once again reported contraction during the month. The industry reported a decrease in employment, a decrease in new export orders, and slower supplier deliveries.
The prices index decreased to 39.4%, a 3.6 percentage-point decline from November’s 43%. This indicates that raw materials prices decreased for the third consecutive month. The food, beverage, and tobacco industry was one of 10 industries that reported paying decreased prices for raw materials.
According to one industry respondent, “Lead times are returning to normal for most of our suppliers, while some of our smaller suppliers are struggling to remain staffed up enough to keep up with orders.”