New Orders, Production, Employment and Inventories Growing
Supplier Deliveries Faster

(Tempe, Arizona) — Economic activity in the manufacturing sector expanded in June for the 30th consecutive month, and the overall economy grew for the 73rd consecutive month, say the nation’s supply executives in the latest Manufacturing ISM® Report On Business®.

The report was issued today by Bradley J. Holcomb, CPSM, CPSD, chair of the Institute for Supply Management® (ISM®) Manufacturing Business Survey Committee. "The June PMI® registered 53.5 percent, an increase of 0.7 percentage point over the May reading of 52.8 percent. The New Orders Index registered 56 percent, an increase of 0.2 percentage point from the reading of 55.8 percent in May. The Production Index registered 54 percent, 0.5 percentage point below the May reading of 54.5 percent. The Employment Index registered 55.5 percent, 3.8 percentage points above the May reading of 51.7 percent, reflecting growing employment levels from May at a faster rate. Inventories of raw materials registered 53 percent, an increase of 1.5 percentage points from the May reading of 51.5 percent. The Prices Index registered 49.5 percent, the same reading as in May, indicating lower raw materials prices for the eighth consecutive month. Comments from the panel indicate mostly stable to improving business conditions, with the notable exception relating to the oil and gas markets. Also noted is the negative effect on egg prices and availability due to the avian flu outbreak."

Of the 18 manufacturing industries, 11 are reporting growth in June in the following order: Furniture & Related Products; Wood Products; Nonmetallic Mineral Products; Miscellaneous Manufacturing; Food, Beverage & Tobacco Products; Electrical Equipment, Appliances & Components; Transportation Equipment; Fabricated Metal Products; Chemical Products; Paper Products; and Computer & Electronic Products. The four industries reporting contraction in June are: Petroleum & Coal Products; Primary Metals; Plastics & Rubber Products; and Machinery.

WHAT RESPONDENTS ARE SAYING ...
  "Avian flu is having a huge effect on egg pricing and items manufactured with eggs." (Food, Beverage & Tobacco Products)
  "Automotive industry remains strong and is expected to stay that way through 2015." (Fabricated Metal Products)
  "Business continues to hold in the U.S., [but is] soft in Europe and in decline in Asia." (Transportation Equipment)
  "Manufacturing business has improved slightly." (Chemical Products)
  "Slight improvement in defense spending on future business." (Computer & Electronic Products)
  "Most prices are stable and business is stable." (Nonmetallic Mineral Products)
  "Downturn in oil and gas markets impacting demand." (Miscellaneous Manufacturing)
  "Stable. Extra capacity available if more orders come in." (Textile Mills)
  "A bit slow. Sales down from last year." (Machinery)
  "Business continues to be strong, with housing starts being up in our markets driving cabinet sales." (Furniture and Related Products)

To read the full report, click here.