The overall economy grew for the 13th straight time after seven months of contraction, while the manufacturing sector expanded for the 10th time after 18 months of contraction, the Institute for Supply Management reported yesterday.
According to the ISM’s monthly report on business, the ISM index dipped to 59.7 in May from 60.4 in April. Economists polled by Thomson Reuters predicted the index would fall to 59.0.
“The manufacturing sector grew for the 10th consecutive month during May,” said Norbert J. Ore, chairman of ISM’s manufacturing business survey committee. “The rate of growth as indicated by the [purchasing managers index] is driven by continued strength in new orders and production. Employment continues to grow as manufacturers have added to payrolls for six consecutive months.”
“The recovery continues to broaden as 16 of 18 industries report growth,” Ore added. “There are a number of reports, particularly in the tech sector, of shortages of components; this is the result of excessive inventory de-stocking during the downturn.”