Manufacturing activity in September slipped below the break-even point after small increases in July and August, according to the Institute for Supply Management (ISM).
The monthly survey of industrial buyers fell to 49.5 from 50.5 in August. The orders index fell slightly to 49.7, while the production index dropped sharply but remained above 50 at 50.9. The indexes for employment, supplier deliveries, order backlogs and inventories also weakened.
Jim Haughey, Newport Communications' senior economist, said he is not surprised the ISM index slipped below 50, following two months of unremarkable climb.
"Stalled growth in manufacturing will slow economic growth but will not push the economy into another recession," Haughey said. "Consumers, and to a lesser extent, business, continue to increase spending on imported goods, new homes and new mortgages.
"And government spending continues to rise for defense, security and higher school enrollments."
According to Haughey, the expected decline in the dollar will improve the trade deficit and boost manufacturing, assuming that the port shutdown on the West Coast is measured in days. But there will likely be a few more months of steady to slightly lower freight before that improvement is seen.
The monthly survey of industrial buyers fell to 49.5 from 50.5 in August. The orders index fell slightly to 49.7, while the production index dropped sharply but remained above 50 at 50.9. The indexes for employment, supplier deliveries, order backlogs and inventories also weakened.
Jim Haughey, Newport Communications' senior economist, said he is not surprised the ISM index slipped below 50, following two months of unremarkable climb.
"Stalled growth in manufacturing will slow economic growth but will not push the economy into another recession," Haughey said. "Consumers, and to a lesser extent, business, continue to increase spending on imported goods, new homes and new mortgages.
"And government spending continues to rise for defense, security and higher school enrollments."
According to Haughey, the expected decline in the dollar will improve the trade deficit and boost manufacturing, assuming that the port shutdown on the West Coast is measured in days. But there will likely be a few more months of steady to slightly lower freight before that improvement is seen.
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