TEMPE, Arizona – Despite supply chain delays and labor issues, furniture was the second fastest growing industry of the top 15 manufacturing industries tracked by the Institute for Supply Management.
Furniture and its related products were only beaten by the clothing, leather and allied products industries. Home furnishings also saw growth in new orders in December (2), growth in production (1), slower deliveries from suppliers in December (4) and higher inventories (5).
As a respondent from the Furniture and Allied Products segment said, “Business continues to be good, with strong customer orders coming in. Continue to fight against labor, material and transportation pressures. ”
Overall, economic activity in the manufacturing sector increased in December, with the overall economy reaching a 19th consecutive month of growth, according to the country’s procurement officials in the latest Manufacturing ISM Business Report.
“The December manufacturing PMI was 58.7%, down 2.4 percentage points from the November reading of 61.1%,” said Timothy R. Fiore, CPSM, CPM, chairman of the Institute for Supply Management (ISM) Manufacturing Firms Inquiry Committee. This figure indicates an expansion of the global economy for the 19th consecutive month after a contraction in April 2020. “
- The new orders index was 60.4%, down 1.1 percentage points from the November reading of 61.5%.
- The production index registered 59.2%, down 2.3 percentage points from the November reading of 61.5%.
- The price index registered 68.2 percent, down 14.2 percentage points from November’s figure of 82.4 percent.
- The backlog index was 62.8%, 0.9 percentage points higher than the November reading of 61.9%.
- The employment index registered 54.2 percent, 0.9 percentage points higher than November’s reading of 53.3 percent.
- The supplier deliveries index registered 64.9%, down 7.3 percentage points from November’s figure of 72.2%.
- The stocks index was 54.7%, 2.1 percentage points lower than the November reading of 56.8%.
- The new export orders index registered 53.6%, down 0.4 percentage point from the November reading of 54%.
- The import index registered 53.8%, an increase of 1.2 percentage points from the November reading of 52.6%.
“The US manufacturing sector remains in a demand-driven and supply chain environment, with indications of improving labor resources and supplier delivery performance,” said Fiore. Global issues related to the coronavirus pandemic (worker absenteeism, short-term downtime due to parts shortages, staff turnover, and overseas supply chain issues) continue to impact manufacturing . However, panel sentiment remains strongly bullish, with six plus points in growth comments for each cautious comment, down slightly from November. “
Still, forecasts released this month indicate strong expectations for 2022 performance in terms of revenue growth and profitability. The manufacturing sector performed well for the 19th consecutive month, with demand and consumption growing month over month. Meeting demand will remain a challenge, given the challenges of hiring and a clear cycle of workforce turnover at all levels. For the second consecutive month,
Comments from panelists on the Business Inquiry Committee suggest an improvement in hiring month over month, offset by replacement required to deal with turnover. The improvement in the supplier delivery rate was indicated by the easing of the supplier delivery index in December. The transport networks, a harbinger of future supplier delivery performance, still operate erratically; however, there are signs of improvement, ”says Fiore.
The 15 manufacturing industries showing growth in December – in the following order – are clothing, leather and allied products; Furniture and related products; Textile factories; Plastic and rubber products; Machinery; Non-metallic mineral products; Various manufacturing; Chemical products; Electrical equipment, apparatus and components; Fabricated metal products; Computer and electronic products; Food, drink and tobacco products; Transport equipment; primary metals; and Petroleum and Coal Products. The three industries reporting a decrease in December compared to November are wood products; Printing and related support activities; and paper products.