The manufacturing industry in southeastern Wisconsin contracted in October with limited demand hampering performance, according to the latest Marquette-ISM Report on Manufacturing.
The Milwaukee-area PMI registered at 47.46 for October. Any reading below 50 indicates a contracting industry while a reading above 50 suggests growth.
The October report was the first one produced since April. The Marquette University Center for Supply Chain Management discontinued it due to a lack of participation.
“The list just got too thin to warrant economic validity,” said Doug Fisher, director of the center.
Fisher said there was a lot of interest in bringing the report back and the center worked with the leadership of the Milwaukee Institute for Supply Management chapter to find additional participants.
The revived report eliminates questions about commodities to help save time for respondents.
Those interested in participating should contact Beth Krey, the center’s associate director, at beth.krey@marquette.edu. Fisher said participants should be in manufacturing and need to be sourcing managers, directors or executives in southeastern Wisconsin. Companies are limited to one participant, although there are some cases where individuals are in divisions that do not have overlapping markets, Fisher said.
In addition to the PMI reading, the report found contraction in every area except employment and imports. New orders came in at 47.67, production was 46.59, inventories were 42.86, prices were 42.86, backlog was 42.5 and exports were 43.3. Imports came in at 57.69 and employment was at 54.34.
“To me, when I saw the numbers, they kind of reflected the general attitude of the country,” Fisher said.
The report found positive readings for both blue collar, 51.9, and white collar, 59.3, employment. One respondent noted the company continues to hire and invest in new product development.
Other respondent comments were not as pessimistic as the 47.46 reading might suggest. One said November demand would be light but December would include a lot of shipments and a number of orders were already booked.
One respondent said all eyes are on the election and there is concern a new administration could affect trade or cause commodity prices to rise.
Two respondents noted inventory issues were causing challenges for lead times, with one noting the potential for a large order surge to cause problems.
Overall, 42.9 percent of respondents expect to see positive conditions over the next six months, while 38.1 percent expect things to stay the same. Just 19 percent expect conditions to be worse.
Fisher said the hope is that by restarting the report in October the center will be able to identify trends heading into 2017.
“I hesitate to take one data point and make a world out of it,” Fisher said.
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