The Chicago Purchasing Managers' Business Barometer gained to 53.0 in August from 52.3 in July, the National Association of Purchasing Management-Chicago said Friday.
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 53.0 reading for the index.
The production index slipped to 53.0 from 53.6, the new orders index increased to 57.2 from 53.9, the order backlogs rose to 46.5 from 42.9 in the prior survey and inventories surged to 45.0 from 37.7. The employment index fell to 54.9 from 56.6 and the supplier deliveries index was at 50.8, off from 51.0 last month. The prices paid index rose to 65.2 from 63.6.