The Chicago Purchasing Managers' Business Barometer rose to 55.6 in January from 50.0 in December, the National Association of Purchasing Management-Chicago said Thursday.
The data is compiled on a seasonally adjusted basis. An index reading below 50 signals a slowing economy, while a level above 50 suggests expansion.
Economists polled by Thomson Reuters predicted a 51.0 reading for the index.
The production index gained to 60.9 from 52.4, the new orders index increased to 58.2 from 50.4, the order backlogs grew to 46.6 from 45.1 in the prior survey and inventories rose to 55.0 from 48.7. The employment index surged to 58.0 from 46.8; and the supplier deliveries index was at 49.9, down from 52.8 last month. The prices paid index slid to 60.7 from 62.9.
Earlier this month, the annual revision of figures was released.