Positive Signs for U.S. Manufacturing Sector

Economic activity in the manufacturing sector expanded in December for the 17th consecutive month, and the overall economy grew for the 20th consecutive month, according to the latest Manufacturing Institute for Supply Management (ISM) Report on Business, referred to in a report posted today on the Material Handling Industry of America (MHIA) website.

Manufacturing continued to grow in December as the PMI registered 57 percent, an increase of 0.4 percentage point when compared to November's reading of 56.6 percent.

"The manufacturing sector continued its growth trend as indicated by this month's report. We saw significant recovery for much of the U.S. manufacturing sector in 2010," said Norbert J. Ore, CPSM, C.P.M., chair of the Institute for Supply Management Manufacturing Business Survey Committee.

"The recovery centered on strength in autos, metals, food, machinery, computers and electronics, while those industries tied primarily to housing continue to struggle.  Additionally, manufacturers that export have benefited from both global demand and the weaker dollar.  December's strong readings in new orders and production, combined with positive comments from the panel, should create momentum as we go into the first quarter of 2011," added Ore.

Of the 18 manufacturing industries, 11 are reporting growth in December, in the following order: Apparel, Leather, and Allied Products; Primary Metals; Fabricated Metal Products; Machinery; Computer and Electronic Products; Food, Beverage, and Tobacco Products; Textile Mills; Plastics and Rubber Products; Transportation Equipment; Electrical Equipment, Appliances and Components; and Chemical Products.  The four industries reporting contraction in December are: Nonmetallic Mineral Products; Paper Products; Printing and Related Support Activities; and Miscellaneous Manufacturing.

ISM's New Orders Index registered 60.9 percent in December, which is an increase of 4.3 percentage points when compared to the 56.6 percent reported in November. ISM's Production Index registered 60.7 percent in December, which is an increase of 5.7 percentage points from the November reading of 55 percent.