ISM: Manufacturing sector contracted in November

Despite this, ISM said the overall economy continued to expand through November for the 55th month in a row. The institute notes that a PMI reading above 42.5% generally indicates that the overall economy is growing.

“US manufacturing activity contracted again in November, but at a slower rate compared to last month,” said ISM Chair Timothy R. Fiore. He commented that while demand remains weak, several positive indicators suggest it may be stabilizing.

Only three of the 16 manufacturing industries ISM tracks reported growth in November. The primary metals and fabricated metal products industries both remain in contraction.

Comments from executives

The report featured comments from survey respondents. An executive in the primary metal sector noted, “After the election, we have seen an uptick in customers wanting to come back to the US for making their products. We are working through these inquiries. They seem very motivated.”

In contrast, an executive in the fabricated metal products industry was less optimistic, saying, “Business is slowing as customers destock and appear uncertain about near-term demand. Preliminary forecast for 2025 is down significantly; we hope to see improvements now that we are beyond US election uncertainties.”

A respondent in the miscellaneous manufacturing sector shared concerns about potential tariffs, commenting, “Late to the game, we are now working on our buying plan in light of potential increased tariffs on imports from China. Cost and capacity of US manufacturing is a concern; a lack of relationship with alternate low-cost international manufacturers is another.”