Manufacturing growth increased slightly for September, according to an Institute for Supply Management report released today.
After August's index reading grew 0.3 points to 55.7%, this month's index clocked in at a slightly higher 56.2%. That's the highest reading since April 2011 and the fourth straight increase in the monthly index. Based on surveys of purchasing managers, a reading above 50% indicates that the manufacturing economy is generally expanding, while below 50% indicates that it is generally contracting.
Market analysts misjudged September's growth direction, having expected a dip from August to 55%. Unlike today's lackluster manufacturing report from Markit, ISM's numbers put manufacturing at one of the highest growth rates of the recovery.
On a component-by-component basis, new orders growth slowed 2.7 points to 60.5%, coinciding with a 3.5-point dip to 52% for exports. Employment expanded 2.1 points to 55.4%, its highest reading in more than a year, while production remained relatively unchanged at 62.6%.
Eleven of the 18 reporting manufacturing industries reported growth, with electrical equipment leading the improvement. Meanwhile, six reported contractions, with apparel reporting the toughest times.
The growth at factories could be offset by the partial government shutdown that began today. Bradley Holcomb, chairman of the ISM's survey committee, said that survey respondents weren't worried about a possible shutdown last month, but would likely begin to raise concerns if it lasted for long.
Most economists say that a shutdown of a just a few days would have little economic impact. But if dragged on for two weeks, it could shave about 0.3 percentage points from fourth-quarter growth.
-- Material from The Associated Press was used in this report.
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