The Institute of Supply Management has published its monthly analysis of the United States manufacturing industry, reporting an unexpected drop in growth from February's numbers.
The Institute report was summarized as a 51.3 in March, down from a score of 54.2 in February. This fell short of the steady 54 that was estimated by economists at market analysis site MarketWatch. This is also slightly below the 12-month average of 51.7.
However, this is not necessarily bad news, as any score above a 50 means that the industry is growing. Additionally, this latest report marks the fourth consecutive month of growth for US manufacturing, after a slight drop off in November, although the sector expansion as a whole had been on an upward trend until now. The 54.2 score in February marked the fastest growth since June 2011.
The ISM surveyed a number of purchasing managers concerning the slowdown, and found that many pointed to reduced government spending and overall uncertainty on federal regulations as reasons for the March numbers.
Joshua Shapiro, chief U.S. economist at MFR Inc., remarked that March's drop may just be a one month blip, and not emblematic of slowing growth. The first three months overall instead suggest that "the manufacturing sector is now making moderate headway."
The LA Times also reports that the Institute of Supply Management employment index increased by 1.6% last month as factories continued to expand, marking the 42nd straight month of increased hiring. Unfortunately, the index for new orders dropped to 51.4 in March, a loss of 6.4 points, while the production index likewise fell from 57.6 to 52.2. The prices paid index saw a drop to 54.5 from 61.5, which fell below expectations of 59.8.
Overall, out of the 18 industries the Institute of Supply Management tracks for these numbers, only petroleum and coal, chemical, and machinery reported contractions.