• Skip to main content
  • Skip to secondary menu
  • Skip to primary sidebar
  • Skip to footer
  • Subscribe
  • facebook
  • instagram
  • RSS
  • RSMUS.com

The Real Economy Blog

Search

  • Economics
  • Technology
  • Consumer
  • Manufacturing
  • Finance
  • Real Estate
  • Health Care
  • Life Sciences
Home > x-Featured > US manufacturing activity hits 10-year low point

US manufacturing activity hits 10-year low point

Oct. 2, 2019 by Jason Alexander

  • email
  • Twitter
  • Facebook
  • Linkedin

Contraction in U.S. manufacturing is continuing, with activity reaching a ten-year low in September, as economic and political uncertainty weigh on the industrial sector.

According to the latest Institute for Supply Management report, manufacturing reached its lowest point since June 2009 after a second straight month of slowing. The index registered 47.8% in the month, down from 49.1% in August (any figure below 50% signals a contraction); producers continue to face headwinds amid the ongoing trade tensions between the United States and China. These results are consistent with our own RSM US Manufacturing Outlook Index, which has been forecasting a slowdown in manufacturing activity since July, when it declined below the zero level.

Global trade continues to be the most significant issue, demonstrated by the contraction in new export orders that began in July 2019. The new export orders index registered only 41%, the lowest level since March 2009, down from the August reading of 43.3%. In addition, the backlog of orders index contracted for the fifth straight month, and at a faster rate, pointing to continued weakness in manufacturing activity in the months ahead.

As U.S. factory activity continues its retreat, the World Trade Organization issued a warning on global commerce on Oct. 1, in which the international body cut its global merchandise trade growth forecast to 1.2% from 2.6% for 2019. Given the current challenges, and the threat of new tariffs on imported automobiles and automotive parts, middle market manufacturers need to monitor the environment in order to respond quickly to changes in demand, ramping up or scaling back purchases of materials they use in anticipation of demand for their finished products.

  • email
  • Twitter
  • Facebook
  • Linkedin

Related Posts

  • ISM Manufacturing Index continues to contract

    The October ISM Manufacturing Index continued to contract in October, though it improved to 48.3 from September's reading of 47.9, implying a modestly slower pace of contraction in domestic manufacturing sentiment.

  • US manufacturing--slipping away

    The U.S. manufacturing sector slipped closer to contractionary terrain in July, which in our estimation reaffirms the decision by the Federal Reserve to cut interest rates by 25 basis points at its July meeting on Wednesday. The top line sentiment index in the Institute…

  • ISM manufacturing survey points toward further moderation

    Those looking for stabilization in the downward trajectory of U.S. manufacturing sentiment will have to wait until mid-year.The April 2019 Institute for Supply Management Report on Business – an important gauge of U.S. factories – arrived below expectations with the top line index slowing…

Filed Under: x-Featured Tagged With: Jason Alexander, manufacturing

About Jason Alexander

@jaalex53

Jason assists clients in the industrial products, consumer products and financial services industries and has more than 15 years of experience serving large multinational clients with particular emphasis on SEC clients, Fortune 500 and middle market companies. Jason has previously advised clients in the areas of accounting, risk management, mergers and acquisitions, process design and improvement, internal audit, regulatory compliance, internal and external financial reporting and information technology system implementation. Strong record of accomplishment of people, team and practice development across North America, Europe, Latin America, Africa and Asia.

Jason is also on the Board of Directors of the RSM US Foundation and a member of RSM’s cutting edge Industry Eminence Program, which positions participants to understand, forecast and communicate economic, business and technology trends shaping the industries RSM serves.

Primary Sidebar

Categories

  • Economics
  • Technology
  • Consumer Products
  • Manufacturing
  • Financial Services
  • Real Estate
  • Health Care
  • Life Sciences

RSMUS.com Links

The Real Economy

Middle Market Business Index

MMBI Special Reports

Footer

  • Facebook
  • Instagram
  • RSS

About The Real Economy Blog

The Real Economy Blog from RSM US LLP was developed to provide timely economic insights about the middle market economy. It is offered as a complement to RSM’s macroeconomic thought leadership, including The Real Economy monthly publication and the proprietary RSM US Middle Market Business Index (MMBI).

© 2019 RSMUS.com

The Real Economy Blog
  • Economics
  • Technology
  • Consumer
  • Manufacturing
  • Finance
  • Real Estate
  • Health Care
  • Life Sciences