U.S. manufacturers posted their strongest output growth in more than four years in September, according to a survey released Wednesday, as new orders and hiring picked up sharply alongside a broader surge in business activity.
The S&P Global flash manufacturing purchasing managers’ index rose to 57.0 from 53.9 in August, well above the 53.6 economists had forecast and the highest reading since May 2022. Any figure above 50 signals improving conditions from the prior month.
The survey’s measure of factory output climbed to 56.7 from 53.1, its best showing since April 2022. New orders grew at their fastest pace since that month, and factory employment increased at the quickest rate since February 2021. Inventories also rose more rapidly.
The numbers suggest a strong rebound after a softer August, when Federal Reserve data showed manufacturing output fell 0.3 percent — the first monthly decline this year. Wednesday’s survey offers an early read on whether September reversed that slide.
Services Also Surge
Services activity climbed alongside manufacturing. S&P Global’s services business activity index rose to 58.7 from 56.5, topping forecasts of 56.0 and reaching its highest level in nearly five years. Service providers reported their strongest growth in new business since March 2022.
Combined, the two sectors pushed S&P Global’s composite output index to 58.4 from 56.0, the highest since July 2021 and the fourth straight month of accelerating growth. Much of the increase in orders came from domestic customers; goods exports kept falling, while services exports posted modest growth.
Companies expanded payrolls to keep pace with demand, with employment across manufacturing and services rising at the fastest rate since June 2022. Even so, unfinished orders piled up at their quickest pace since May 2022, a sign that many firms are still struggling to keep up with incoming business.
You must be logged in to post a comment Login