Economy: ISM Manufacturing Index for April 2020

Earlier today, the Institute for Supply Management® (ISM®) released their Manufacturing Purchasing Manager's Index (PMI®) for April 2020:

Predicted: 42.0%

Actual: 41.5% (-7.6 points month-on-month change)

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Previous month: 49.1%

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Every month, the ISM surveys purchasing and supply executives at hundreds of companies across the country who are involved in manufacturing in some form. The resulting index is watched closely by academics, economists and investors because manufacturing accounts for about 12% of U.S. Gross Domestic Product (GDP).

The PMI is a reliable barometer of U.S. manufacturing: A PMI above 50% implies that U.S. manufacturing expanded during the month specified, while a reading below 50% implies that the made-in-the-USA sector contracted.

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From Today's Report:

"...Economic activity in the manufacturing sector contracted in April, and the overall economy contracted after 131 consecutive months of expansion, say the nation’s supply executives in the latest Manufacturing ISM® Report On Business®..."

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The following is a sampling of quotes from a diverse pool of U.S. manufacturers:

“Thirty-percent decrease for April due to COVID-19 impact on both customers and suppliers.”
(Computer + Electronic Products)

“Production stopped, other than to make hand sanitizer for those in need.”
(Chemical Products)

“COVID-19 has created a wave of activities, including vendors closing, vendors focusing only on the medical industry, employees not coming to work, delayed shipments from overseas, [and] etcetera.”
(Transportation Equipment)

“The food processing B2B space remains steady. We are weathering the storm. There is a fortunate increased need for packaged foods. Softening is showing through in some products that find their way into food service and lodging.”
(Food, Beverage + Tobacco Products)

“Our refinery is losing money making gasoline due to the falling demand.”
(Petroleum + Coal Products)

“We supply the construction industry in various ways, where the slowdown has been a bit slower than most industries. It is, however; beginning to impact our business, and we see more challenges on the horizon.”
(Fabricated Metal Products)

“The company I work for manufactures personal protective equipment [PPE], specifically N95 masks, face shields, as well as selling protective clothing and hand protection. In the area of PPE, our backlog has spiked to numbers we have never seen. While no doubt some of the backorders will be canceled, many of the orders are longer term commitments from [the] U.S. government.”
(Apparel, Leather + Allied Products)

“Our packaging business is starting to see signs of a slowdown in May after two strong months into COVID-19.”
(Paper Products)

“COVID-19 has destroyed our market and our company. Without a full recovery very soon, and some assistance, I fear for our ability to continue operations.”
(Nonmetallic Mineral Products)