S.E. Michigan Purchasing Managers Index remains steady despite global market concerns
The Southeast Michigan Purchasing Managers Index (PMI) remained relatively stable from July to August, falling just under a point from 57.5 to 56.6.
While some respondents expressed concern over volatility in global markets – China, in particular – the PMI continues to indicate a fairly strong and stable economy for Southeast Michigan. A PMI value above 50 generally suggests economic growth. The 3-month average has remained above 60 since April. It currently stands at 61.1.
According to Timothy Butler, an associate professor of global supply chain management at Wayne State University’s School of Business, who interpreted this month’s results, the slight month-to-month decrease was due mostly to summertime drops in production and new orders, with some commodity prices also falling.
"It won’t come as a surprise to anyone who’s been to the gas pump recently that prices on petroleum and propane are decreasing," Butler said. "Carbon plate pricing was also down this month."
According to Kenneth Doherty, assistant vice president of procurement and strategic sourcing at WSU and an Institute for Supply Management board member, it is noteworthy that the employment index remains high, increasing to 59.1 with a 3-month average of 66.0.
"Employment numbers continue to be strong,” Doherty said. "It will be interesting to see if and when global issues impact the local job market."
Survey participants appear to be cautiously optimistic about the business environment moving forward. More than 83 percent believe the economy will be either more stable or about the same over the next six months, while 16.7 percent believe the environment will be less stable.
The Southeast Michigan Purchasing Managers Index (PMI) is a research partnership between Wayne State University’s School of Business and the Institute for Supply Management - Southeast Michigan.
