Clothes, fuel and computers lead factory report
Are retailers are expecting a hot run on new fashions in the spring? Who knows, but clothing was the top growth sector in manufacturing in December. It was one of nine growing sectors that produced the fifth consecutive month of expansion for the nation’s manufacturing sector.
That’s according to the Institute for Supply Management, which also reports the overall economy grew for the eighth consecutive month, based on ISM’s survey of supply executives.
“This month’s report is quite strong as both the New Orders and Production Indexes are above 60 percent,” says Norbert Ore, chair of ISM’s Business Survey Committee. “The sector may be benefiting from an excessive destocking cycle as indicated by the recent performance of the Customers’ Inventories Index.”
ISM’s Purchasing Managers Index rose to 55.9 percent, its highest reading since April 2006, when it registered 56 percent. The PMI was up 2.3 percentage points over November’s reading of 53.6 percent, indicating continuing recovery in the sector at a faster rate of growth. A reading above 50 percent indicates that the manufacturing economy is generally expanding.
What ISM calls Apparel, Leather & Allied Products led the PMI with the highest growth. The other eight sectors that expanded were, in order:
- Petroleum & Coal Products;
- Computer & Electronic Products;
- Electrical Equipment, Appliances & Components;
- Transportation Equipment;
- Paper Products;
- Furniture & Related Products;
- Food, Beverage & Tobacco Products.
The seven industries reporting contraction in December were:
- Wood Products;
- Nonmetallic Mineral Products;
- Miscellaneous Manufacturing;
- Plastics & Rubber Products;
- Chemical Products;
- Printing & Related Support Activities;
- Fabricated Metal Products.