Manufacturing activity in southeastern Wisconsin continued its downward trend in November as new orders and order backlogs both declined during the month, according to the latest Marquette-ISM Report on Manufacturing.
The report’s Milwaukee-area PMI dropped from 45.24 in October to 44.74 in November. A reading below 50 suggests the region’s manufacturing sector is contracting. The index has now been below 50 in four of the past five months and the six-month average is now below 50 for the first time since October 2020.
Respondents to the survey used to generate the index pointed to a number of issues, including growing fears of a recession, declining product demand, high interest rates, long lead times and inventory management issues.
Both the blue collar and white collar employment indices in the report remained below 50 at 45.7. Respondents said there have been decreases in new employment and some firms are implementing hiring freezes, although others noted an increase in demand for blue collar labor.
The business outlook for the next six months also worsened with 70% of respondents expecting conditions to worsen, up from 50% with that view in October. Just 10% expect conditions to improve over the next six months, down from 25% in October.
Those shifts combined to drive the business outlook diffusion index, which attempts to account for positive and negative bias, down from 37.5% to 20%.
