Nearly all of the components of the Marquette-ISM Report on Business moved in the right direction in November as respondents reported increased demand, larger orders and reduced political uncertainty following the election.
The report’s Milwaukee-area PMI jumped to 54.11, up from 47.46 in October. Any reading above 50 indicates growth in the region’s manufacturing sector.
The report found strong growth in new orders, production, prices and order backlog. The six-month outlook for business conditions also improved, with the index increasing to 70.7 percent from 61.9 percent in October.
Nearly half, 48.3 percent, of respondents expect positive conditions over the next six months, while 44.8 percent expect the same conditions. Both figures were an increase from the October reading as the number expecting things to get worse dropped from 19 percent to 6.9 percent.
Respondents cited the end of the election and an expected increase in infrastructure spending for the positive outlook, although one cautioned that 2017 didn’t look any better than 2016.
While some said they were receiving larger orders and increased demand, others pointed to revenues being down and not having enough demand.
The one area of the report that trended in the wrong direction was employment, falling from 54.34 in October to 45.58 in November. The index for both white and blue collar employment was at 51.3, down from 59.3 and 51.9 respectively in October.
Meanwhile, data released by the Chicago Federal Reserve added to the mixed picture for Wisconsin’s manufacturing industry over the last few months. The Chicago Fed’s Midwest Economy Index registered a zero for Wisconsin in both September and October, indicating the industry is growing at its historical average. The index for the full region increased from -0.03 to 0.01. The growth was led by Michigan.
Wisconsin manufacturing’s relative index, which measures performance against the nation, increased from 0.01 in September to 0.02 in October, while the composite of state’s covered by the Chicago Fed increased from 0.15 in September to 0.21 in October on strength from Michigan and Iowa.
Overall, Wisconsin’s MEI reading improved from -0.06 in September to -0.04 in October, while the region as a whole moved from -0.10 to -0.01. Wisconsin made gains in construction and consumer industries while taking a slight step back in services.
The state’s relative measure dropped from -0.04 in September to -0.05 in October, even as the regional measure improved from 0.17 to 0.25. Wisconsin was flat in construction and improved in consumer industries, but again dropped on the service side.
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