The Markit U.S. Manufacturing Purchasing Managers' Index (PMI) fell 1.9% to 51.8 for October, its lowest reading in a year, according to a Markit report (link opens a PDF) released today.
While this latest reading is the worst in 12 months, an above-50 reading still denotes positive change from the previous month, putting this report in growth territory.
This month's report also pulled ahead of its flash index, which clocked in at 51.1 two weeks ago. The "flash" estimate is typically based on approximately 85% to 90% of total PMI survey responses each month and is designed to provide an accurate advance indication of the final PMI data.
On a component-by-component basis, the all-important new orders edged down 0.5 points to 52.7, while a 4.7 point drop in output to 50.6 put the component at its weakest growth rate in over four years. As a positive sign among pessimistic points, the employment component managed a solid 1.4 point increase to 52.7.
Chief economist Chris Williamson was quoted as saying:
While better than the earlier flash reading, the final PMI data indicate that the U.S. manufacturing sector ground to a near standstill in October. Encouragingly, it looks like companies are expecting the slowdown to be temporary, most likely linked to the government shutdown, as indicated by an upturn in the rate of job creation. However, even the faster growth of employment remains only modest, consistent with barely any increase in official data on manufacturing payrolls.
