ISM Manufacturing PMI — May 2026
Headline: The Manufacturing PMI rose 1.3 points to 54.0 in May, signaling expansion at a faster rate for the fifth consecutive month. The reading was a 6-month high, versus a trailing six-month average of 51.1 and prior range of 47.9–52.7. Manufacturing remained above its 50.0 breakeven, while the broader economy continued to grow for the 19th straight month, above its 47.5 breakeven.
Sub-indices:
| Index | Level | Prior | Change | Direction | vs 6-mo |
|---|---|---|---|---|---|
| New Orders | 56.8 | 54.1 | +2.7 | Growing | above avg (52.6) |
| Production | 54.3 | 53.4 | +0.9 | Growing | above avg (53.4) |
| Employment | 48.6 | 46.4 | +2.2 | Contracting | above avg (46.8) |
| Supplier Deliveries | 60.6 | 60.6 | 0.0 | Slowing | above avg (54.9) |
| Inventories | 49.9 | 49.0 | +0.9 | Contracting | 6-mo high |
| Customers' Inventories | 42.7 | 39.1 | +3.6 | Too Low | above avg (40.8) |
| Prices | 82.1 | 84.6 | -2.5 | Increasing | above avg (68.2) |
| Backlog of Orders | 52.2 | 51.4 | +0.8 | Growing | above avg (50.6) |
| New Export Orders | 50.6 | 47.9 | +2.7 | Growing | 6-mo high |
| Imports | 53.0 | 50.3 | +2.7 | Growing | above avg (50.2) |
Key moves:
- The headline PMI reached a 6-month high, with New Orders at 56.8, well above its six-month average of 52.6.
- New Export Orders rose to a 6-month high of 50.6, crossing from contraction to expansion.
- Employment improved to 48.6, its highest level in the six-month window, but remained below 50; Inventories also reached a 6-month high of 49.9 while still contracting.
Insights:
- The demand signal strengthened materially: New Orders accelerated to 56.8, while Backlog of Orders rose to 52.2. With both above 50 and above their six-month averages, the forward production pipeline remains constructive.
- Manufacturers’ inventories stayed just below 50 at 49.9, indicating continued contraction rather than an accumulation. Given stronger New Orders and Backlogs, the lean inventory position appears more consistent with replenishment demand than an involuntary buildup.
- Customers’ Inventories remained “too low” at 42.7. As an inverse indicator, this supports future production and ordering, although the reading improved from 39.1, reducing the degree of channel tightness.
- Supplier Deliveries at 60.6 indicate slower deliveries, not faster ones. The elevated level—well above the six-month average of 54.9—is consistent with sustained demand and/or supply-chain tightness.
- Price pressure remained acute: Prices registered 82.1, despite easing 2.5 points. The level is substantially above its six-month average of 68.2, implying continued input-cost and goods-inflation risk for manufacturers.
Breadth & prices: All 16 industries reported growth, with zero industries contracting. Input prices continued to increase, though at a slower rate than in April.
Takeaway: May’s print points to a broad-based strengthening in the manufacturing cycle, led by orders, exports and a healthy backlog, with the PMI at a six-month high. The main offsets are persistent input-cost pressure and continued manufacturing job contraction, suggesting stronger output momentum without a comparable labor-market recovery.