The Milwaukee-area manufacturing sector continued its decline in October, according to a report released today by the Institute for Supply Management-Milwaukee.
October’s seasonally adjusted Purchasing Managers’ Index (PMI) was 43.3, down from 47.2 in September.
The manufacturing sector was growing consistently for three years until July, when it dipped below 50. A PMI above 50 indicates expansion.
New orders, production, employment, inventories, backlog of orders, exports and imports declined this month. Supplier deliveries grew at a slower rate, while customer’ inventories and prices were also growing.
Employment was mixed this month. Blue collar employment was declining, at 45.5, while white collar employment was growing, at 57.1.
Buying policies changed as well, with capital expenditures increasing by 22 days to 106 days and average lead time for production materials increasing by three days to 44 days. The average lead time for maintenance, repair and operating supplies held steady at 20 days.
The October survey also included an extra question: “What is your outlook on business conditions six months from now?” Outlooks were 32 percent positive, 42 percent same and 26 percent worse.
Manufacturers’ comments from the survey included:
“Although not supported by economic data or conditions, our corrugated supplier has announced a 5.1 percent increase. Prices on most other commodities remains unchanged.”
“Heavy truck production is down due to shorter work schedules, which has reduced our order rate.”
“Increasing pessimism globally for remainder of 2012 and 2013.”
“Customers worry about election outcome.”
“Business will remain slow or soft until after the elections. Business owners don’t want to invest until they know what direction government will go.”
“We are moving aggressively to grow our business, not waiting for the economy to improve.”