Survey Shows U.S. Manufacturing Activity Reaches More Than Four-Y…

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Written by Danny Levin, Deputy Editor for IIR News Intelligence (Sugar Land, Texas)

Summary

The Institute of Supply Management’s (ISM) Purchasing Managers Index showed economic activity in U.S. manufacturing reached its highest level since May 2022. Industrial Info Resources’ project data shows strong spending in the U.S. Industrial Manufacturing Industry.

U.S. Manufacturing Activity Rolls On

The Institute of Supply Management’s (ISM) Purchasing Managers Index showed economic activity in U.S. manufacturing reached its highest level since May 2022, with demand indicators showing faster growth. Strong spending in the U.S. Industrial Manufacturing Industry is reflected in Industrial Info Resources’ project data.

The PMI, which tracks 18 manufacturing sectors in the U.S., registered 55.6% in July, up from 53.3% in June–indicating faster growth month-over-month. Any reading over 50% indicates expansion in the manufacturing economy. July also marks the seventh month in a row of expansion.

According to Industrial Info Resources data, there is $687 billion worth of projects under construction in the U.S. Industrial Manufacturing Industry; more than half of the investment is attributed to data centers and semiconductors. The Global Market Intelligence (GMI) Project Database offers a full list of projects.

Any reading under 50% indicates contraction in the manufacturing economy.

“We have a really strong report this month,” Susan Spence, chair of ISM’s Manufacturing Business Survey Committee, said during a news media call.

Three of the four demand indicators–the New Orders, Backlog of Orders and New Export Orders indexes–expanded in July. The New Orders Index expanded for the seventh consecutive month, up 0.7% from June.

In terms of output, July’s Production Index jumped 6.3% month-over-month and reached its highest level since November 2021.

In a press release accompanying the survey, Spence said 38% of respondents’ comments were positive while 62% were negative, with a 1:1.6 ratio of positive to negative sentiment.

In the call, she acknowledged that “the continued Iran war and remaining price volatility” are still risk factors for manufacturing operations. Survey respondents echoed that sentiment.

Pricing volatility was mentioned in 57% of the negative comments, the Iran war 43%, increasing lead times 22% and tariffs 18%.

Mixed Feelings

Although July’s Prices Index, an indicator of input and raw materials costs, continues to show elevated price pressures, the reading of 71.1% lessened from June’s 73%.

The elevated index continues to be driven by increases in steel and aluminum prices impacting the entire value chain; tariffs applied to many imported goods; and increases in petroleum-based products as a result of the recent Middle East conflict.

“Demand is up, and prices are up as a result,” Spence said. She added that although the list of shortages “is pretty significant” and “certainly could get worse” depending on geopolitical factors, currently “orders are flowing.”

The PMI considers shortage items to be specific commodities, raw materials, components, or labor services that are reported to be in short supply or difficult to source.

“Overall, we’re definitely optimistic,” she said.

A Transportation Equipment survey respondent said, “Continued tariffs on products utilized in our product lines are being monitored by the business, which is working to mitigate or limit tariff risk. Geopolitical risk, especially in the Middle East, pertaining to commodity and energy markets remains a concern. There has been some increased cost and transit time for rerouted shipments due to conflicts in the Red Sea, Strait of Hormuz and Suez Canal.”

On a positive note, one respondent from Computer & Electric Products said a favorable demand environment is driven by growth in the semiconductor, artificial intelligence (AI), advanced packaging and high-performance computing (HPC) markets. “Recent company reports indicate strong sales growth and continued investment in manufacturing capacity.”

The ISM considers semiconductors and data-center components to be part of the sector.

Strong U.S. Manufacturing Capex

IIR data show data centers account for about 46% of the total investment value of U.S. Industrial Manufacturing Industry projects under construction.

AI cloud infrastructure provider Fluidstack is building out a multi-billion-dollar grassroot data enter in Abernathy, Texas, north of Lubbock. The facility is expected to feature 168 megawatts (MW) of critical load capacity, in order to provide expanded high-performance computing (HPC) support in the region.

Also in Texas, the first building of Google’s planned six-building data center campus in Oklaunion, near the Oklahoma border, kicked off in March. Construction is expected to wrap up next year.

Readers can view the two project reports.

IIR’s North American Construction Starts Index also shows strong capital spending: The monthly index for the U.S. Industrial Manufacturing industry in June (the latest available data) indicated 1,719 construction starts, with a project value of $209 billion–up from 1,604 projects worth $160 billion year over year.

Key Takeaways

• The ISM’s PMI survey shows U.S. manufacturing activity in June reached its highest level since May 2022.
• Three of four demand indicators–including new orders–are growing at a faster rate.
• The Iran war and tariffs still are driving ongoing price pressures for manufacturers.
• $687 billion: value of projects under construction in the U.S. Industrial Manufacturing Industry. About half is attributed to data centers.



About Industrial Info Resources

Industrial Info Resources (IIR) is the leading provider of industrial market intelligence. Since 1983, IIR has provided comprehensive research, news and analysis on the industrial process, manufacturing and energy related industries. IIR’s Global Market Intelligence (GMI) helps companies identify and pursue trends across multiple markets with access to real, qualified and validated plant and project opportunities. Across the world, Industrial Info Resources is tracking over 250,000 current and future projects worth $30.2 trillion (USD).

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US manufacturing activity rose in June, factory hiring fell to six-year low | Ukraine news

Stronger orders mask mounting cost pressures and job cuts in factories, raising questions about whether production gains can sustain without easing input inflation.

Washington, June 23 – activity in the U.S. manufacturing sector rose again in June: companies front-loaded new orders in response to anticipated shortages and rising prices, but factory employment fell to a six-year low due to rising operating costs tied to the conflict in the Middle East.

According to S&P Global, the preliminary Manufacturing PMI rose to 55.7 this month – the highest since May 2022, while May stood at 55.1. A reading above 50 indicates expanding production, which accounts for about 9.4% of the economy. Economists surveyed by analysts expected the manufacturing PMI to slip to 54.8.

Growth in manufacturing was accompanied by an uptick in the services PMI to 51.3 from 50.7 in May, lifting the U.S. composite PMI according to S&P Global to 52.2 from 51.5 last month. The rise in the services PMI is partly linked to the FIFA World Cup, hosted by the United States, Canada and Mexico.

The manufacturing PMI index has risen for the fourth month in a row, partly due to companies replenishing inventories in case of shortages and rising prices.

The war between the United States, Israel and Iran, which has been ongoing for four months, is weighing on global supply chains and boosting prices for oil-related goods, as well as for aluminum and fertilizers.

Last week the United States and Iran signed an interim agreement aimed at ending the war. On Monday, Vice President JD Vance said that talks with Iranian officials in Switzerland laid a “good foundation” for a final peace agreement, despite tensions over the Hormuz Strait and Lebanon.

Layoffs in manufacturing have reached their highest level since 2009, excluding the pandemic, underscoring concerns about the durability of the recent demand growth amid rising input costs.

– Chris Williamson

Private-Sector Employment Remains Low

Overall private-sector employment remained subdued for the second month in a row. This contrasts with the Labor Department data showing private payroll growth rebounding over the last three months. For the three months ended May, private nonfarm payrolls averaged 166,000 jobs per month, versus only 62,000 in the same period in 2025. Analysts surveyed note that private surveys do not always accurately forecast official employment data.

The manufacturing new orders index, according to S&P Global, rose to a more than four-year high for the month. The rise was attributed to demand being temporarily supported by warnings of potential supply disruptions and higher prices due to the war. Meanwhile the inventories index reached its highest level in 13 months.

Additionally, supplier lead times lengthened to levels last seen in August 2022. Before the war, suppliers had been constrained by broad tariffs imposed by the Trump administration. While a drop in oil prices from multi-year highs at the outset of the conflict restrained further increases in input costs, inflation at factory sites remained high.

The Prices paid by factories for inputs fell to 71.2 from 75.3 in May. Manufacturers continued to pass costs on to consumers, though the pace of price declines slowed. The Prices received by manufacturers for goods produced fell to 61.0 from 63.1 in May. The decline was partially offset by gains in the services sector, and the overall index of prices received by the private sector stayed at 58.6. The overall input prices index fell to 62.1 from 62.5 in May.

Elevated readings reflect economists’ expectations of sustained high inflation and the likelihood of the Federal Reserve raising interest rates within the year amid rising inflation risks.

Current data indicate the industrial sector is behaving flexibly: demand and inventory management support output, but weaker employment in manufacturing and rising costs remain key concerns for the U.S. economy.

In summary, shifts in demand and supply are shaping today’s production dynamics: on one hand, recovery and inventories; on the other, higher costs and weak employment, underscoring the need for steady anti-inflationary policy and careful monitoring of the labor market in the coming months.

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U.S. Manufacturing Activity Hit A Four-Year High in May, But There’s a Caveat

U.S. manufacturing activity rose to its highest level in four years in May amid rising costs, supply disruptions and uncertainty tied to the war with Iran, according to new data.

The S&P Global flash U.S. manufacturing purchasing managers’ index climbed to 55.3 in May from 54.5 in April, marking the strongest reading since May 2022. A reading above 50 indicates expansion.

The gain, however, was driven largely by manufacturers building inventories to protect against potential shortages and higher prices. S&P Global’s survey showed input inventories rose to an 11-month high, while supplier delivery times worsened, a pattern consistent with companies buying ahead of possible supply chain problems.

However, S&P Global said cost pressures intensified, with factory input costs reaching their highest level since June 2022. Companies also raised output prices, suggesting that some of those higher costs may eventually reach consumers.

The broader economy also looked softer than the headline manufacturing figure. S&P Global’s flash composite PMI, which tracks manufacturing and services, held at 51.7 in May. The services PMI slipped to 50.9 from 51.0, barely above contraction territory. Manufacturing employment rose modestly, but overall private-sector employment fell to its lowest level in 21 months, largely because of weaker services hiring.

Chris Williamson, chief business economist at S&P Global Market Intelligence, told Reuters that the reading indicated “that the economy will struggle to manage annualized GDP growth of much more ​than 1% in the second quarter.” He also cautioned that inventory accumulation tied to supply concerns is not a durable engine for expansion.

“On average, over the past three months order book growth has slowed to its weakest for two ⁠years, ​and a boost from precautionary stock building due to concerns over ​further price hikes and supply delays will not last forever,” said Williamson.

Manufacturing represents a smaller share of the U.S. economy than services, but remains closely watched because it is sensitive to global demand, shipping costs, commodity prices, and business confidence. The sector accounts for about 9.4% of the economy, according to the National Association of Manufacturers, so its strength alone may not be enough to offset weakness in services.

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US manufacturing activity hits 4-year high: White House

US manufacturing is witnessing a surge across the country as the sector is growing for the third consecutive month, with key indicators showing broad strength, the White House recently said.

The Institute for Supply Management’s (ISM) key manufacturing index—which tracks factory activity across the country—registered the sector’s third straight month of expansion for its highest reading since 2022.

US manufacturing is seeing a surge as the sector is growing for the third month in a row, with key indicators showing broad strength, the White House said.
The ISM manufacturing index saw the third straight month of expansion for its highest reading since 2022.
The Federal Reserve Bank of Philadelphia’s April manufacturing index rose.
Orders for capital goods exceeded $4 billion in each month of Q4 2025.

The ISM new orders index expanded for the third consecutive month as both domestic and global buyers turn to US-made goods. The production index expanded for the fifth consecutive month and is accelerating as factories run at a pace not seen since before the Joe Biden-era slowdown, a White House release said.

The Federal Reserve Bank of Philadelphia’s manufacturing index surged in April, smashing expectations.

The manufacturing sector capped off the first quarter of 2026 with the first positive manufacturing job growth in three years. In a year, real manufacturing worker pay increased by $2,400 under President Trump after falling by $830 during President Biden’s four years in office.

The broader US economy has now expanded for 17 consecutive months, a streak of sustained growth the Biden Administration was never able to deliver.

Meanwhile, US Trade Representative Jamieson Greer testified this week before the House of Representatives Ways and Means Committee to lay out how Trump’s trade policy is delivering tangible results for American workers and their families, eliminating long-standing trade barriers abroad while reshoring jobs and production back home.

He highlighted the surge in orders for capital goods used for production, exceeding $4 billion each month of the fourth quarter of 2025.

Fibre2Fashion News Desk (DS)

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US manufacturing activity drops to lowest point of 2025: PMI

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U.S. manufacturing activity decreased to its lowest point of 2025 last month, affected by continued tariff uncertainty and weak demand, according to the Institute for Supply Management’s latest Purchasing Managers’ Index.

ISM’s index registered 47.9% in December, down 0.3 percentage points compared with November. A PMI index below 50% shows an industry in contraction.

Despite improvements in three of the four main demand areas — including new orders, backlog of orders and new export orders — the indexes continued to be in contraction as they have been for months. Meanwhile, production slipped 0.4 percentage points, but was in expansion for the second month in a row.

Susan Spence, chair of ISM’s Manufacturing Business Survey Committee, said on a call with reporters Monday that the demand improvements are good, but the question remains if this could be the start of a turnaround or “just another blip.” She also noted that production expansion is likely in a “bubble” following four months of new orders in contraction.

“When new orders start turning around and expand for more than a month at a time — one, two, three, four, five months — then you’re going to see it flow to production and backlog, and then everything should follow,” Spence said.

Last month, new orders expanded in two of the 18 manufacturing sectors that ISM tracks, and only one of them was in computer and electronic products, which has seen major growth last year driven by data center buildouts to accommodate artificial intelligence demand.

Surveyed panelists cited tariffs as the biggest issue for them last month. Executive participants reported softer international orders as uncertainty around U.S. economic policy continues, Spence said, citing a ratio of 1.5 negative comments for every positive one regarding export orders.

Separately, employment contracted at a slower rate, with a majority of panelists saying that their companies are managing head counts instead of hiring. Additionally, supplier deliveries are slower compared to November and customer inventories are in the “too low” category, which can be a positive indicator for future production.

A mix of staff reductions, a lack of backfilling and continued price increases signals “that we’re still in a struggling economy,” Spence said. Compared to the overall economy, which has grown steadily every month since April 2020, the manufacturing sector has contracted for most of 2025.

Of the big six sectors that PMI follows, Spence said the computer and electronics products category expanded for half of the year, while other areas like transportation equipment and chemical products contracted most months. Meanwhile, petroleum and coal products expanded for the first nine months of the year and declined in the last three, she added.

“We’ll see what happens with the latest news out of Venezuela,” said Spence, who oversaw sourcing and procurement at FedEx for 10 years. President Donald Trump’s military operation in the South American country could shock U.S. and global oil prices.

Currently, companies like Chevron and ConocoPhillips are monitoring the situation and say it’s too early to speculate on future business activities or investments, News Nation reported. Chevron has infrastructure and workforces in Venezuela, while ConocoPhillips does not.

“It depends on what the plan is and if the country can come roaring back from an … infrastructure issue,” Spence said.

S&P’s December manufacturing PMI report provided a similar picture for the month as new orders fell for the first time over the past year and international sales continued to decline, due in part to tariffs. On the brighter side, the credit rating agency saw employment growth for most of the year and job creation was its most pronounced since August.

Although manufacturers ramped up production in December, prospects for the start of 2026 are “looking less rosy,” Chris Williamson, chief business economist at S&P Global Market Intelligence, said in a statement.

“Factories are continuing to produce goods despite suffering a drop in orders,” he said, adding that the gap between production and orders is the widest it has been since the height of the 2008 global financial crisis.

“Unless demand improves, current factory production levels are clearly unsustainable,” Williamson said.

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