MARKETPULSE
Index Series Series Percentage Direction Rate of Trend*
Index Index Point Change (Months)
March Feb Change
PMI 53. 7 53. 2 +0.5 Growing Faster 10
NewOrders 55.1 54. 5 +0.6 Growing Faster 10
Production 55. 9 48. 2 + 7. 7 Growing FromContracting 1
Employment 51.1 52. 3 -1.2 Growing Slower 9
Supplier 54.0 58.5 - 4. 5 Slowing Slower 10
Deliveries
Inventories 52. 5 52. 5 0.0 Growing Same 2
Customers’ 42.0 46. 5 - 4. 5 TooLow Faster 28
Inventories
Prices 59.0 60.0 -1.0 Increasing Slower 8
Backlog of Orders 57.5 52.0 + 5. 5 Growing Faster 2
Exports 55. 5 53. 5 + 2.0 Growing Faster 16
Imports 54. 5 53. 5 +1.0 Growing Faster 14
OVERALL ECONOMY Growing Faster 58
Manufacturing Sector Growing Faster 10
MANUFACTURING AT A GLANCE: March 2014
ISM: Manufacturing Springs Into Production
Bradley J.
Holcomb, Chair of
ISM Mfg ROB
Economic activity in the manufactur- ing sector expanded in March for the 10th consecutive month, and
the overall economy grew for the 58th
consecutive month, say the nation’s supply
executives in the latest Manufacturing ISM
Report On Business.
“The March ISM report confirms that
the fundamentals of manufacturing
activity are positive,” noted Daniel J.
Meckstroth, Chief Economist for the Manufacturers Alliance for Productivity and
Innovation (MAPI). “The index of 53. 7 in
March is slightly better than 53. 2 in February, and both are above the 50 percent
level that separates growth from decline.
Over the last 20 years, the ISM index has
equaled or been higher than 53. 7 only 39
percent of the time.”
Orders and Inventory
ISM’s New Orders Index registered 55.1
percent in March, an increase of 0.6
percentage point when compared to the
February reading of 54. 5 percent. This rep-
resents growth in new orders for the 10th
consecutive month. A New Orders Index
above 52.1 percent, over time, is generally
consistent with an increase in the Census
Bureau’s series on manufacturing orders
(in constant 2000 dollars).
The Inventories Index registered 52. 5
percent in March, the same reading as
reported in February, and indicates that
inventories are growing for the second
consecutive month, following two consecutive months of contraction. An Inventories Index greater than 42. 8 percent, over
time, is generally consistent with expansion in the Bureau of Economic Analysis’
(BEA) figures on overall manufacturing
inventories (in chained 2000 dollars).
According to Bradley J. Holcomb, CPSM,
CPSD, chair of the ISM Business Survey
Committee,“Inventory levels are good and
I think the mix is improved from a couple
of months ago when it was probably dragging down production.”
Overall Results
“The March ISM report should allay fears
of an industrial slowdown,” Meckstroth
added. “Manufac-
turing production is never smooth and
we expect a strong rebound in produc-
tion activity over the next three quarters.
Now that economic policy uncertainty
has receded because of a federal budget
agreement, we expect business investment
to accelerate both this year and next and
be the principal driver of an accelerating
growth rate in manufacturing. There is
still some pent-up demand for motor
vehicles, although the greatest opportu-
nity is in the resurrection of the housing
supply chain. Manufacturing production
increased 2. 2 percent in 2013 and MAPI
forecasts 3. 2 percent growth this year.”
Overall, Holcomb feels this month’s
report is very well structured in terms of
all of the supporting indexes being over
50 and the PMI continuing to increase. “I
think it’s a very nice report, which bodes
well for the future,” concludes Holcomb.
For more information on the Institute for
Supply Management, visit www.ism.ws.
