The latest ISM Report On Business shows that economic activity in the US manufacturing sector grew in April, but growth in many aspects is slowing.
Institute for Supply Management chairman Timothy R. Fiore notes that the US manufacturing sector remains in a demand-driven, supply chain-constrained environment. In April, progress slowed in solving labour shortage problems at all tiers of the supply chain. Survey respondents reported higher rates of resignations compared to previous months, with fewer reporting improvement in meeting head-count targets.
April saw a slight easing of prices expansion, but instability in global energy markets continues.
Surcharge increase activity across all industry sectors continues.
The survey found strong optimism regarding demand, although the three positive growth comments for every cautious comment was down from March's ratio of six-to-one.
Supply chain and pricing issues remain the biggest concerns.
Five of the six biggest manufacturing industries — machinery; computer and electronic products; food, beverage and tobacco products; transportation equipment; and chemical products — registered moderate-to-strong growth in April.
"Manufacturing performed well for the 23rd straight month, with demand registering slower month-over-month growth (likely due to extended lead times and decades-high material price increases) and consumption softening (due to labour force constraints). Overseas partners are experiencing COVID-19 impacts, creating a near-term headwind for the US manufacturing community,” he adds.