Last updated on July 7th, 2019 at 02:48 pm
Following Wednesday’s report that showed further contraction in industry activity in the Milwaukee area, a national report released today also showed a slowdown.
According to the Manufacturing ISM Report On Business, the purchasing managers’ index (PMI) reflected stagnant activity in the sector nationwide, falling from 51.1 in August to 50.2 in September. Any number more than 50 indicates growth, while less than 50 signals contraction.
This was the lowest level since May 2013.
A blog from the National Association of Manufacturers said this illustrates the struggles that manufacturers continue to face in light of headwinds in the economy from the stronger dollar and sluggishness abroad.
In the September survey, respondents showed concerns over exchange rates, crude oil, China and apprehensive customers. Below are some of the comments:
• “Revenues and profits in our industry continue to (be) impacted by low crude and gas prices.”
• “High value of dollar is affecting global procurement pricing.”
• “Concerns about China downturn and its effect on our consumer confidence.”
• “Overall business is slowing. Consumers are nervous. Not sure what is coming next.”
• “The orders from customers seem to be slowing a bit from the first part of the year. We have promises but not actual Purchase Order numbers.”
• “Continue to feel impact of oil and gas market slowdown. Aerospace demand has also been slower than expected. Consumer Electronics not robust.”
Areas that were down from August to September included new orders (51.7 to 50.1), production (53.6 to 51.8), and employment (51.2 to 50.5).
“This report reflects continued slow growth for manufacturers, as global headwinds present a persistent challenge for the sector,” the NAM’s blog said. “Manufacturing leaders express cautious optimism for the coming months, but it is clear that the strong dollar, reduced crude oil prices and soft global demand have taken their toll on production and overall sentiment.”
As for the Milwaukee-area report released Wednesday, the PMI was below 50 for the sixth consecutive month, according to the Marquette-ISM Report on Manufacturing.
The PMI was at 39.44 in September, down from 47.67 in August. It has been below 50 for eight of the past 25 months.
The continued low PMI comes at a time when several large Milwaukee-area manufacturers have been announcing significant job reductions.
Earlier this week, GE Power & Water announced it will lay off 350 employees, and Joy Global Surfacing Mining Inc. said it will lay off 113 workers beginning Nov. 30.
Johnson Controls Inc. also recently announced plans to cut 3,000 people globally over the next two years, and Caterpillar Inc. expects to eliminate 10,000 jobs at unspecified locations by 2018.