Economy
Chicago Business Barometer declines further in November
Written by Brett Linton
November 27, 2024
The Chicago Business Barometer continues to indicate deteriorating business conditions in November, easing to a six-month low, according to Market News International (MNI) and the Institute for Supply Management (ISM).
The Barometer reading slipped 1.4 points from October to 40.2 in November. Recall that in September it rose to the second-highest reading of 2024. A barometer reading above 50 indicates improving business conditions, while a reading below that indicates contraction.
October marks the 11th consecutive month the Barometer has been in contraction territory.
The index has averaged 42.9 in the first 11 months of this year. The Barometer has only indicated expansion for one month in the past two years (November 2023).
The MNI report attributes declines in November in four of the subcomponents: production, order backlogs, employment, and supplier deliveries. The only subcomponent to improve over October was new orders.
Special questions
Respondents were asked two special questions in this month’s survey, which ran from Nov. 1 through Nov. 15.
Q: Over the past three months, how has your ability to pass on input costs changed?
A: The majority (55%) reported no change in their ability to pass on costs. Just over 44% said they were less able to or somewhat less able to do so. The remaining respondents indicated a somewhat greater ability.
Q: Has there been a change in levels of inventories beyond seasonal norms to offer protection from further supply chain disruptions?
A: Most respondents (73%) stated that their inventory levels are either in line with seasonal norms or lower due to demand concerns. Only 18% reported a slight increase in inventory, while 9% said they were unsure.
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Brett Linton
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