Factory job growth hits 5-year peak as US manufacturing keeps growing in October
(TNND) — The American manufacturing sector grew in October, with strong demand driving factory hiring to levels not seen in over five years.
S&P Global and the Institute for Supply Management released reports Monday on the health of the U.S. manufacturing sector. Both reports draw on surveys of manufacturing executives.
ISM showed the manufacturing sector expanded in October for the 10th straight month, which followed a 10-month streak of contraction.
ISM’s monthly surveys are used to generate a purchasing managers’ index, or PMI. That headline index registered 55.5%, near its 12-month high and a percentage point above September.
A manufacturing PMI above 47.5% generally indicates an expansion of the overall economy, according to ISM.
All five subindexes that directly factor into the PMI were in expansion territory. Those are new orders, production, employment, supplier deliveries, and inventories.
ISM also said five of the six largest manufacturing industries expanded in October.
Meanwhile, the S&P Global manufacturing PMI registered a 54.9 in October.
S&P Global said manufacturing growth remained “comfortably above trend” in October, though it said its PMI softened a bit from September’s 52-month high of 55.9.
Chris Williamson, the chief business economist at S&P Global Market Intelligence, said in the report that the U.S. manufacturing sector is having its best growth spell since early 2022.
“However, growing pains are clearly evident, with factories struggling to meet strong demand, especially for AI-related goods and equipment, amid supply chain disruptions,” Williamson said. “Delivery delays, often linked to shipping and logistics issues, are more widespread than at any time since 2022.”
S&P Global said manufacturers responded to increasing backlogs by generating jobs at a pace not seen for five-and-a-half years.
The firm said production and new orders increased in October, though at slower rates.
And inflationary pressures intensified.
S&P Global said demand pressures have allowed producers to increasingly pass along their higher costs to customers.
“Such steep growth in factory gate prices will inevitably feed through to consumers in the coming months, keeping inflation well above the Fed’s target and adding to pressure on policymakers to raise interest rates further,” Williamson said.
Victoria Bloom, the chief economist for the National Association of Manufacturers, told The National News Desk that both the ISM and S&P Global reports showed “continued strength in manufacturing.”
Bloom said the ISM report showed growth accelerated, while the S&P Global report showed growth softened. She chalked that up to differences in who the two firms survey and how they weight different components.
But she said both reports broadly told a growth story in American manufacturing, despite cost pressures and an increasing concern of price volatility.
FILE – Employees work on the line at the Webasto Plymouth Plant on May 1, 2026, in Plymouth, Michigan. (Photo by Sarah Rice/Getty Images)
Bloom said the backlog struggles differ by manufacturing subsector, but she views those demand pressures as a positive sign for future production.
She said factories have seen consistently strong demand from their customers, and not just those supporting data center construction.
“We’re optimistic that we’ll continue to see that in the months to come,” Bloom said. “And we see investment has really picked up, and we saw that kind of begin in the middle of last year following the passage of the tax bill. … Purchases of machinery and equipment picked up, and we also saw in this recent Q3 GDP report that spending on structures picked up. That is something that had been lagging for several quarters.”
Bloom also said the manufacturing sector can sustain its job growth as long as the new orders keep coming in and if the factory bosses aren’t deterred by the “environment of uncertainty” in the economy.
“But I think a lot of manufacturers have kind of adjusted to that uncertainty, or at least recognized that new order growth is too strong now for them to not be able to hire new workers to keep up with that new demand,” she said.
