Login



For PLUS+ subscription assistance, contact customer service.

Not a PLUS+ Subscriber?

Become a PLUS+ Subscriber today and you'll get access to all Supply Chain Management Review premium content including:

  • Full Web Access
  • 7 Magazine Issues per Year
  • Companion Digital Editions
  • Digital Edition Archives
  • Bonus Email Newsletters

Subscribe Today!

Premium access to exclusive online content, companion digital editions, magazine issues and email newsletters.

Subscribe Now.


Become a PLUS+ subscriber and you'll get access to all Supply Chain Management Review premium content including:

  • Full Web Access. All feature articles, bonus reports and industry research through scmr.com.

  • 7 Magazine Issues per year of Supply Chain Management Review magazine.

  • Companion Digital Editions. Searchable replicas of each magazine issue. Read them in any web browser. Delivered by email faster than printed issues.

  • Digital Editions Archives. Every article, every chart and every table as it appeared in the magazine for all archive issues back to 2009.

  • Bonus email newsletters. Add convenient weekly and monthly email newsletters to your subscription to keep your finger on the pulse of the industry.

PLUS+ subscriptions start as low as $109/year*. Begin yours now.
That's less than $0.36 per day for access to information that you can use year-round to better manage your entire global supply chain.

For assistance with your PLUS+ subscription, contact customer service.

* Prices higher for subscriptions outside the USA.

PLUS+ Customer Service Support


Customer service for all PLUS+ subscribers is available Mon-Fri, 9am-5pm Eastern time.

Email: [email protected]
Phone: 1-800-598-6067 (1-508-663-1500 x294 outside USA)
Mail: PO Box 1496, Framingham MA 01701-1496, USA



You have been logged out of PLUS+


For PLUS+ subscription assistance, contact customer service.

Need to access our premium PLUS+ Content?
Upgrade your subscription now.


Our records show that you are currently receiving a free subscription to Supply Chain Management Review magazine, or your subscription has expired. To access our premium content, you need to upgrade your subscription to our PLUS+ status.

To upgrade your subscription account, please contact customer service at:

Email: [email protected] Phone: 1-800-598-6067 (1-508-663-1500 x294 outside USA)

Become a PLUS+ subscriber and you'll get access to all Supply Chain Management Review premium content including:

  • Full Web Access. All feature articles, bonus reports and industry research through scmr.com.

  • 7 Magazine Issues per year of Supply Chain Management Review magazine.

  • Companion Digital Editions. Searchable replicas of each magazine issue. Read them in any web browser. Delivered by email faster than printed issues.

  • Digital Editions Archives. Every article, every chart and every table as it appeared in the magazine for all archive issues back to 2010.

  • Bonus email newsletters. Add convenient weekly and monthly email newsletters to your subscription to keep your finger on the pulse of the industry.

PLUS+ subscriptions start as low as $129/year*. Start yours now.
That's less than $0.36 per day for access to information that you can use year-round to better manage your entire global supply chain.

This content is available for PLUS+ subscribers.


Already a PLUS+ subscriber?


To begin or upgrade your subscription, Become a PLUS+ subscriber now.

For assistance with your PLUS+ subscription, contact customer service.

Sorry, but your login to PLUS+ has failed.


Please recheck your login information and resubmit below.



For PLUS+ subscription assistance, contact customer service.

Manufacturing ends 2018 on a decline, reports ISM

On the heels of a slight gain from October to November on the heels of two mild sequential declines, manufacturing output for the month of December finished 2018 on a downward slide, according to the monthly manufacturing Report on Business, which was released today by the Institute for Supply Management (ISM). The report’s key metric, the PMI, dropped 5.2% to 54.1 (a reading of 50 or higher indicates growth). Even with the decline, the index has now grown for 28 consecutive months, with the overall economy now having grown for 116 consecutive months.

By ·
By ·

On the heels of a slight gain from October to November on the heels of two mild sequential declines, manufacturing output for the month of December finished 2018 on a downward slide, according to the monthly manufacturing Report on Business, which was released today by the Institute for Supply Management (ISM).

The report’s key metric, the PMI, dropped 5.2% to 54.1 (a reading of 50 or higher indicates growth). Even with the decline, the index has now grown for 28 consecutive months, with the overall economy now having grown for 116 consecutive months.   

Prior to the November increase, the PMI saw sequential declines in September and October, following its most recent high of 61.3 in August, the highest reading over the last 15 months. The December PMI is 4.7% below the 12-month average of 58.8 and is also the lowest PMI reading during this period.

ISM reported that 13 of the 18 manufacturing sectors reported growth in December, including: Textile Mills; Apparel, Leather & Allied Products; Machinery; Transportation Equipment; Computer & Electronic Products; Wood Products; Chemical Products; Food, Beverage & Tobacco Products; Miscellaneous Manufacturing; Electrical Equipment, Appliances & Components; and Primary Metals. The six industries reporting contraction in December were: Printing & Related Support Activities; Fabricated Metal Products; Nonmetallic Mineral Products; Petroleum & Coal Products; Paper Products; and Plastics & Rubber Products.

Along with the PMI, each of the report’s key metrics fell in December.

New orders, which are commonly referred to as the engine that drives manufacturing, fell 11% to 51.1 but grew for the 36th consecutive month, with six of 18 manufacturing sectors reporting growth for the segment. This marks the lowest level for new orders going back to August 2016, when it came in at 50.5.

Production fell 6.3% to 54.3, growing for the 28th consecutive month, and employment was off 2.2% to 56.2, growing for the 28th consecutive month. Supplier deliveries, at 56.2 (a reading above 50 indicates contraction) decreased at a slower rate for the 27th month in a row. Inventories fell 1.7% to 51.2, while still growing for the 12th consecutive month.

Comments submitted by ISM members for the report voiced concerns on various fronts, including slowing economic growth, the impact of Brexit, and customer demand, among others.

“Growth appears to have stopped,” said a computer & electronic products respondent. “Resources [are] still focused on re-sourcing for U.S. tariff mitigation out of China.”

A transportation equipment respondent said that customer demand continues to decrease due to concerns about the economy and tariffs.

Tim Fiore, chair of the ISM’s Manufacturing Business Survey Committee said that the December report’s sub-indexes, including new orders, hit its lowest levels in recent years, including: production at its lowest level since September 2016; employment in January 2018; and supplier deliveries in December 2017.

“The real surprise, in this report, is new orders at 51.1,” he said. “Going back in history, we saw an 11.7% drop in January 2014, which bounced back 3.7 points the next month. The PMI falling to 54.1 is not a 2008-like event, which is the single largest decline since October 2008, which is about a 20% drop in the range. But I don’t think that is what we are looking at here. There is a lot of uncertainty here. December is generally a slow month anyway, with a lot of people off for the holidays and less manufacturing workdays, weather issues, the closing of the fiscal year. You can almost argue that people had a plan in the bag and decided not to overreach in December….there is a seasonality factor in four of the five sub-indexes. December did not feel as good as November.”

December prices, at 54.9, fell 5.8%, while still growing for the 34th consecutive month, and backlog of orders, at 50, fell 6.4% compared to November but unchanged when compared to November as three of the top six manufacturing industries recording expansion. Exports rose 0.6% to 52.8, and imports slipped 0.9% to 52.7.

The trio of backlog of orders, new orders, and customer inventories (up 0.2% to 41.7), which Fiore views collectively as a proxy for the health of the demand side, saw two of those three readings decline, with no expansion for backlog of orders. The last time that happened was January 2017 at 48.6. But Fiore said that it was a positive that customer inventories remained low at 41.7, with the caveat that it is the index that ISM respondents have the “least feel for,” as it is difficult for the supply community to understand how much inventory customers actually have on hand.” 

Looking ahead, Fiore said he expects manufacturing output to bounce back to the mid-50’s range, from around 55-to-57, with December serving as a signal to manufacturing decision-makers to be more proactive and bring back some needed stability.

“Having a North American steel and aluminum market would be a really great move, as would resolving the $200 billion increase in tariffs,” he said. “I think the Fed had to do what they did in December to raise the federal interest rate by a quarter of a point, and it would be surprising if it is raised more in the next six months. It would also be good to get the federal government back to work, too.” 


About the Author

Jeff Berman, Group News Editor
Jeff Berman is Group News Editor for Logistics Management, Modern Materials Handling, and Supply Chain Management Review. Jeff works and lives in Cape Elizabeth, Maine, where he covers all aspects of the supply chain, logistics, freight transportation, and materials handling sectors on a daily basis. Contact Jeff Berman

Subscribe to Supply Chain Management Review Magazine!

Subscribe today. Don't Miss Out!
Get in-depth coverage from industry experts with proven techniques for cutting supply chain costs and case studies in supply chain best practices.
Start Your Subscription Today!

Article Topics

ISM · Manufacturing · PMI · All Topics
Latest Whitepaper
2019 Top 5 Trends of Enterprise Labeling
This year’s sixth annual Top 5 Trends in Enterprise Labeling report outlines significant shifts in labeling that are impacting businesses and global supply chains at an unprecedented level.
Download Today!
From the January-February 2019
If history is our guide, economies take a turn every nine years. Yet time and again, a strong business cycle and fading memories convince us the good times will go on forever. Ten years after the great recession, we surveyed 100 manufacturing firms to find out if businesses are ready to fight through the next recession.
Truck Driver Shortage: No one behind the wheel
Intermodal to the rescue
View More From this Issue
Subscribe to Our Email Newsletter
Sign up today to receive our FREE, weekly email newsletter!


Latest Webcast
Leveraging the Internet of Things (IoT) in Manufacturing
Is Digital Transformation a risk or an opportunity? This webinar will detail Manufacturing industry challenges and how using IoT can address these challenges through optimizing logistics, improving processes and gaining meaningful insights.
Register Today!
EDITORS' PICKS
Supply Chain Management Issues Confronting Us This Year
A variety of fresh challenges will surface for global traders in January and beyond
Global Supply Chain Pricing May Face New Pressures in 2019
The global economy started 2018 with strong, synchronized growth, but the momentum faded as the year...

IHS Markit’s New Economic “Predictions” for 2019 and Impact on Global Supply Chains
The U.S. will remain “above trend,” while other key economies will experience further...
Global Kuehne + Nagel Indicators Signal Global Supply Chain Resilience
So far this year, international merchandise trade has risen by 10.6%. Emerging markets and North...