Manufacturing ISM Rebounds Slightly

Following three months of contraction, the September 2012 Manufacturing ISM PMI is back in the green at 51.5%.

Index	Sep	Aug	Percentage Point Change	Direction	Rate of Change	Trend in Months
PMI�	51.5	49.6	1.9	Growing	From Contracting	1
New Orders	52.3	47.1	5.2	Growing	From Contracting	1
Production	49.5	47.2	2.3	Contracting	Slower	2
Employment	54.7	51.6	3.1	Growing	Faster	36
Supplier Deliveries	50.3	49.3	1	Slowing	From Faster	1
Inventories	50.5	53	-2.5	Growing	Slower	2
Customers' Inventories	49.5	49	0.5	Too Low	Slower	10
Prices	58	54	4	Increasing	Faster	2
Backlog of Orders	44	42.5	1.5	Contracting	Slower	6
Exports	48.5	47	1.5	Contracting	Slower	4
Imports	49.5	49	0.5	Contracting	Slower	2

Production is still in contraction. Deliveries and inventories are nearly flat. The big jump is in employment, still in its 36th month of expansion. I doubt that trend continues given the global slowdown.

Respondent Comments

• "Appears that our so-called 'slowdown' was a summer thing. September brings with it increasing requirements and business." (Paper Products)
• "Business improved through Q3, but is beginning to show signs of slowing down in Q4; this has been a typical trend over the last few years." (Wood Products)
• "Business has picked up going into the last quarter." (Plastics & Rubber Products)
• "We are sticking to our manufacturing plan, but have slowed production down considerably. Haven't added any new units to the 2012 plan, and still have no forecast for 2013 released." (Computer & Electronic Products)
• "Sales have tanked over the last two months, bringing a very concerned and stressed management team. Not very optimistic for the near-term future." (Apparel, Leather & Allied Products)
• "Uncertainty in the healthcare legislation (reform) continues to be the underlying force keeping our sales revenue below its full potential." (Miscellaneous Manufacturing)
• "Steel and aluminum prices still dropping, and auto production orders are up." (Transportation Equipment)
• "Domestic business is up; international is down." (Electrical Equipment, Appliances & Components)
• "Demand seems to have stabilized from August. New orders are appearing this month without advanced notice from our customers." (Chemical Products)

Respondent Comments are all over the map from "summer slowdown" to "sales have tanked last two months".

A one month rebound is not that significant unless it is a trend change which I highly doubt.

Mike "Mish" Shedlock

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