Purchasing Managers Index Dips In November
The Southeast Michigan Purchasing Managers Index dropped to 54.2 in November, suggesting that Metro Detroit's economy continued to grow over the past month but at a slower rate than October. The October PMI was a robust 67.1.
The Southeast Michigan PMI is a composite index of local economic activity. It is calculated from a monthly survey of purchasing managers administered by faculty from the School of Business Administration at Wayne State University and the local chapter of the Institute for Supply Management. A score above 50 indicates economic expansion. The higher the score is above 50, the faster the growth rate.
Key indicators such as production, new orders and employment showed slower growth rates in Metro Detroit during the month of November. While this is not favorable, over time the Southeast Michigan PMI is sustaining growth, scoring above 50 for 10 consecutive months.
Nitin Paranjpe, an economist and supply chain faculty member at Wayne State's business school who analyzed the survey data, said the slowdown in November may be seasonal variation.
"A number of factors play into the fluctuation of a PMI score," said Paranjpe. "We keep an eye on the trends over time for a big picture view of the economy and Southeast Michigan is showing signs of stability and steady growth for almost a year now."
Chicago's PMI also expanded in key areas, further supporting a positive trend in the Midwest. Further, the national PMI shows that the manufacturing sector has grown for 16 straight months in the United States.
When asked about the business environment over the next six months, more than 85 percent of the local purchasing managers surveyed said they expect the Southeast Michigan economy to remain about the same or improve. Among their concerns were a vote on federal tax extensions and the coming changes in state government.
The complete Purchasing Managers Index report for November is available online at www.ism-sem.org/uploaded_pics/pdf-20101203080317.pdf.
The Institute for Supply Management - Southeast Michigan serves its members as an affiliate of the Institute for Supply Management by providing superior opportunities for education, networking, and career enhancement as a means of advancing and promoting the leading edge practices and profession of purchasing and supply management.
(c) 2010, WWJ Newsradio 950. All rights reserved.
