Good news for U.S. manufacturers in September as the end of month reports released in early October state that the sector continues to climb its way out of the recent decline it’s seen since the spread of Covid-19 in early 2020.
What does this good news mean for the industry, the overall economy, and for the health of your business? Continue reading to find out more!
According to the Institute for Supply Management (ISM), its manufacturing Purchasing Managers’ Index (PMI) increased from an August reading of 47.6 to 49.0 in September, the highest reading since the 47.6 score reported in November 2022.
The other side of the coin?
September did mark the 11th straight month that the PMI remained below 50%, (the longest such stretch since the 2008 recession) which does indicate a slight contraction in the overall manufacturing industry.
That being said, while the PMI and other business surveys continue to paint a potentially grim picture of the industry, the data being reported suggests that the sector continues to move forward amid higher borrowing costs.
Economists looking for further proof need only look at recent orders for long-lasting manufactured goods, which increased 4.2% year-on-year in August.
In addition, business spending on equipment appears to have also remained strong in the third quarter of the year after its recent rebound earlier this year, proving to any naysayers that this most recent upward trending in the industry could very well be much more than a fluke.
Since the earliest days of the United States, the manufacturing sector has proven itself to be a vital component of the nation’s economy.
In fact, most studies show that U.S. manufacturing accounts for a whopping 12% of the entirety of the nation’s economy, contributing approximately $2.3 trillion to the U.S. GDP as recently as 2021.
Additionally, the manufacturing sector just so happens to be the 4th largest industry in the United States when it comes to employment statistics, with 12.984 million employees as of 2023.
Added to this, the ISM survey’s forward-looking new orders sub-index increased to 49.2 in September, up from August’s reported 46.8. This is believed to be due to the recent improvement in new orders along with the accelerated pace of production within domestic factories. As such, the production index managed to increase from 50.0 in August to 52.5 in September.
As you can see, the manufacturing sector is not only important to those of us who live within it, but to the entirety of the U.S. – and global – economy as a whole.
It’s for this very reason that economic officials in D.C. are sighing with relief today as this vital industry takes yet another step away from disaster, inching its way, not just out of danger, but potentially into new heights of success.
We’ve said it before and we’ll say it again… Much like the fluctuations seen in the recent U.S. housing market, when you start noticing upward movement, often times its too late to act.
You see, in housing, everyone saw prices skyrocket and thought it would be a good time to invest in real estate, but by that point, the prices had already hit their peak and were starting their decline. As a result, now there are currently many houses for sale with sellers expecting those peak prices, yet, at this point, there are not as many buyers out there scooping them up.
Generally speaking, this same rule applies to those manufacturers waiting to invest in Industry 4.0.
With the recent upward trends seen in the manufacturing sector, though we have yet to return to the highs of years prior, the industry continues to advance its way towards that end goal, and potentially further.
Those that act NOW, will be prepared when the manufacturing sector finally does officially round the corner and begin reaching its full potential. Those that decide to wait, will be left scrambling to get their facilities in order while the rest of us are counting our cash.
Anyone waiting for a better time to take that first step towards their digital transformation is going to be sorely disappointed.
Folks, there is no better time to invest in Industry 4.0.
As the days pass, and the U.S. manufacturing sector gets closer and closer to regaining its full momentum, anyone in the industry that has not started their digital transformation moves further and further away from the many benefits the future has in store.
Believe us, securing your business’s health and sustainability is worth the risk!
With that return, not only will U.S. manufacturers profit, but the overall economic health of the nation will begin to grow yet again, spurring a potential economic boom that has in its power to stimulate, not just you and me, but the entirety of the globe.
… And that, in this author’s opinion, makes the health of U.S. manufacturing industry a worthwhile pursuit.
P.S. You know, in the world of business, sometimes it’s nice to have a little predictability.
For example, after investing thousands of your hard-earned dollars on a system to help your business thrive, you should be able to predict that system will hold up its end of the bargain.
None the less, time after time, systems break, requiring costly man hours to repair and costing you considerable additional resources to get back on track.
Assurance Support is Rain Engineering’s state-of-the-art preventative machine software and support system, designed to keep your operations running at their peak, foster user adoption and drive front line worker engagement, and increase your ability to scale.
Paired with your GE Digital license maintenance and product support, these plans offer tools that fit the way YOU work, not the other way around.
If you have a support team, but need extra horsepower to complete bigger projects, there is a plan for you.
If your team can take care of the basics, but sometimes needs a little help for tricky or persistent issues, there is a plan for you too!
After all, when you can resolve incidents quickly and eliminate lingering problems, you can maintain focus on the things that really matter, like moving your business forward.
… and by being staffed with Certified Pro Proficy resources and a support methodology built to fit your ITIL 4 Framework, you’ll truly have the power to tackle whatever issues may come your way.
Don’t let unexpected delays and costly errors get in the way of your business’s ability to perform at its peak.