ISM Semiannual Economic Forecast

Even though the manufacturing and service sectors have been on diverging paths in 2023, with manufacturing having contracted for 13 consecutive months and services having grown for 11 consecutive months, respectively, through November,one common theme they share is expectations for growth in 2022. That is a key takeaway from the Institute for Supply Management’s (ISM) December 2023 Semiannual Economic Forecast.

While growth is expected to remain in the cards, for the manufacturing and services sectors, over the balance of 2023, it is no longer set to expand at the same rates as were previously indicated, according to the  “Spring 2023 Semiannual Economic Forecast,” which was issued this week by the Institute for Supply Management (ISM).

For manufacturing, ISM is estimating a 5.5% revenue gain in 2023, falling short of its 6.5% estimate from its predecessor report in May and its 9.2% 2022 growth rate. ISM member panelists are calling for 2023 services-based economy revenues to see a 3.1% gain in 2023, topping 2022’s 2.1% gain, which fell short of May’s 4.9% estimate.

The Services PMI—at 54.4 (a reading of 50 or higher signals growth)—fell 2.3% compared to September, growing, at a slower rate, for the 29th consecutive month, with services sector growth intact for 151 of the last 153 months through October. What’s more, the October Services PMI reading came in at its lowest level going back to May 2020’s 45.2.

For manufacturing, ISM is estimating a 9.2% revenue gain, topping the 2022 estimate, from the December report, at 6.5%. ISM member panelists are calling for 2022 revenues to rise 4.9%, ahead of December’s 4.3% 2022 projection, and in line with 2021’s 4.8% increase.

For manufacturing, ISM is estimating a 6.5% 2022 revenue gain, trailing the 7.2% estimate, for 2021, and the the report said that its panelists are calling for 2022 revenues to see a 4.3% annual gain, in line with 2021’s 4.8% increase, adding that 17 sectors are calling for revenue gains in 2022.

For manufacturing, ISM is estimating a 7.2% in 2021 revenue gain, topping the 6.9% projection made in its previous report, and services revenue is pegged to increase 5.4% in 2021, topping the previous estimate of 1.6%.

The reading for the report’s key indicator—the Services PMI (formerly the Non-Manufacturing PMI)—came in at 63.7 (a reading of 50 or higher indicates growth is occurring) in March, an 8.4% increase over February’s 55.3. This reading represents the tenth consecutive month of services sector growth, at a faster rate, as well as its highest monthly reading going back to October 2018’s 60.9. Services sector growth has seen gains in 132 of the last 134 months.

Coming off of 2020, which saw myriad ebbs and flows related to the ongoing COVID-19 pandemic, 2021 is expected to point in the direction of economic improvement, for both the manufacturing and services sectors, according to the new edition of the Institute for Supply Management’s (ISM) Semiannual Economic Forecast, which was issued today.

While its predecessor report, which was released in December, issued a positive 2020 growth outlook for the manufacturing and non-manufacturing sectors, the new edition of the Institute for Supply Management’s (ISM) Semiannual Economic Forecast, which was issued today, tells a much different story, due to the ongoing COVID-19 pandemic.

The Institute for Supply Management’s (ISM) Semiannual Economic Forecast, which was issued last week, provided a deep dive into how both manufacturing and non-manufacturing purchasing and supply management executives view what could be in store for 2020, in terms of key benchmarks like revenue growth, capital expenditures, and capacity utilization among others.

For manufacturing, ISM is estimating a 4.8% annual increase in 2020 revenue, which is up from the 1.9% increase that was pegged for 2019 over 2018. What’s more, 58.1% of manufacturing respondents expected 2020 revenues to be higher than 2019. And revenue growth in 2020 is expected to see annual gains in all 18 manufacturing industries ISM tracks.

A forecast for continued growth for both the manufacturing and non-manufacturing sectors remains positive, based on data in the Institute for Supply Management’s (ISM) Spring 2019 Semiannual Economic Forecast, which was released today. Data for this report is based on feedback from U.S.-based purchasing and supply chain executives in manufacturing and non-manufacturing sectors.

Optimism for the manufacturing and non-manufacturing sectors, in 2019, is firmly intact, albeit not at the same level as 2018, according to the Institute for Supply Management’s (ISM) Semiannual Economic Forecast, which was released this week.