US Manufacturing in Freefall: Four Months of Contraction and a Record Low in Imports

The US manufacturing sector continues its downward spiral, reporting a fourth consecutive month of contraction in May. This alarming trend is highlighted by the Institute for Supply Management’s (ISM) monthly survey, released on June 2nd, which revealed a Manufacturing Purchasing Managers Index (PMI) of 48.5 percent – a slight dip from April’s 48.7 percent.

Any reading below 50 indicates contraction within the sector, a significant concern given manufacturing accounts for approximately 10 percent of the US economy. The persistent decline is further underscored by the New Orders Index, which also remained in negative territory for the fourth straight month, signaling weak demand and a troubling lack of momentum.

Adding to the grim picture, import levels plummeted to their lowest point since 2009. This sharp decrease reflects the broader economic slowdown and dwindling consumer confidence.

According to Susan Spence, chair of ISM’s Manufacturing Business Survey Committee, key indicators including factory output, orders, and employment all remain below growth levels. This paints a concerning picture for the overall health of the US manufacturing sector and its ripple effect on the broader economy. The ongoing contraction raises serious questions about the strength and resilience of the US economy in the coming months.