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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