The overall economy grew for the eightieth straight time, while the manufacturing sector contracted for the fourth month in a row, the Institute for Supply Management reported Monday.
According to the ISM's monthly report on business, the ISM index increased to 48.2 in January from 48.0 in December.
Economists polled by Thomson Reuters predicted the index would be 48.0.
An index reading below 50 signals a slowing economy, while a level above 50 suggests expansion. A reading of 50 shows the sector was unchanged in the month.
The prices paid index held at 33.5. The employment index fell to 45.9 from 48.0.
The production index climbed to 50.2 from 49.9, the new orders index grew to 51.5 from 48.8; the supplier deliveries index gained to 50.0 from 49.8; the export orders index fell to 47.0 from 51.0; and the imports index increased to 51.0 from 45.5.
The inventories index remained at 43.5; the customers' inventories index stayed at 51.5; and backlog of orders grew to 43.0 from 41.0.
Respondents' comments included:
- "The oil and gas sector continues to be challenged by low oil and gas prices. Risk of suppliers filing for bankruptcy and reducing their workforce is becoming an increasing risk. Our company workforce is also declining." (Petroleum & Coal Products)
- "Business this month [is] better than last month and better than this period last year. Reduced oil and basic chemical prices providing favorable margin comparisons." (Chemical Products)
- "Huge rollout in wireless in 2016 across all markets. We should be very, very busy." (Computer & Electronic Products)
- "We are a bit slower, but staying busy." (Fabricated Metal Products)
- "Business is still strong, but slowing." (Transportation Equipment)
- "2016 starting off with strong orders." (Primary Metals)
- "Market is sluggish to start the year." (Wood Products)
- "Medical device continues to be strong." (Miscellaneous Manufacturing)
- "Overall demand is higher than expected for post-holiday season." (Plastics & Rubber Products)
- "Much worldwide macroeconomic uncertainty affecting our business. Business confidence seems low." (Food, Beverage & Tobacco Products)
