Southeastern Wisconsin’s manufacturing sector continued contracting in August, marking the second straight month the sector has shrank after an extend run of growth.
The Milwaukee-area PMI in the latest Marquette-ISM Report on Manufacturing came in at 48 for August, down from 49.42 in July. A reading above 50 suggests the region’s manufacturing sector is growing while sub-50 readings indicate contraction.
The index had been on a strong run of growth, topping 50 every month since August 2020. Even with two months below 50, the index has averaged 52.4 over the past six months.
Respondents to the monthly survey reported decreasing new orders and continued challenges finding labor. However, respondents also noted some supply chain issues easing, lead times decreasing and improvements in international transportation.
The outlook for the next six months does not look promising in the August report. Half of respondents expect business conditions to worsen and another 43% expect conditions to remain the same. Just 7% expect improving conditions, putting the diffusion index for business condition outlook at 28.6%.
The diffusion index attempts to balance positive and negative bias. It was at 37.5% in July and 42.3% in June.
