 "General view of metal cutting machines at a factory in Cleveland, Ohio, USA, on May 26, 2021. (Photo: Timothy Aeppel/Reuters)")
Even as US President Donald Trump promised to shore up manufacturing and make America great again, he has presided over continuous decline of the sector.
In September, the US factory output fell for the seventh straight month, according to the Institute for Supply Management’s (ISM) manufacturing index.
Even though the index rose to 49.1 in September from 48.7 the previous month, it remained below 50, according to Bloomberg.
In the ISM manufacturing index, a reading under 50 means contraction and above 50 means expansion.
ALSO READ: Trump promised ‘golden age’ for America, jobs data show economy is ‘flashing yellow’
Since assuming office in January, Trump’s policies, ranging from tariffs to crackdown on immigrants, have caused an economic crisis. Economic growth has slowed, prices have risen, and recession odds have grown, and a leading economist has said that a third of American states are likely already in recession. With such a state of affairs, the US economy appears headed to a dangerous condition called ‘stagflation’ where inflation and recession coexist.
| Month | PMI Reading | Previous Month | Analyst Assessment |
|---|---|---|---|
| January 2025 | 50.9 | 49.2 (Dec 2024) | First expansion after 26 months of contraction |
| February 2025 | 50.3 | 50.9 | Second consecutive month of expansion, but weakening |
| March 2025 | 49.0 | 50.3 | Return to contraction after brief expansion |
| April 2025 | 48.7 | 49.0 | Continued contraction |
| May 2025 | 48.5 | 48.7 | Third consecutive month of contraction |
| June 2025 | 49.0 | 48.5 | Fourth consecutive month of contraction |
| July 2025 | 48.0 | 49.0 | Fifth consecutive month of contraction |
| August 2025 | 48.7 | 48.0 | Sixth consecutive month of contraction |
| September 2025 | 49.1 | 48.7 | Seventh consecutive month of contraction |
Job growth has also flattened unemployment has surged. In August, the US economy added just 22,000 non-farm jobs , which was less than a third of projected job growth and the unemployment rose to 4.3 per cent, according to the Bureau of Labor Statistics (BLS).
An analysis by Yahoo Finance noted that the US economy just added 8,000 new non-farm jobs in the June-August period.
US manufacturing continues to fall after false hope
In January and February, the manufacturing grew but it later turned out to be a false start.
In March, however, the manufacturing contracted again and has continued to contract since.
In the September report, ISM Chair Susan Spence noted that manufacturing contracted at a slower rate. But she flagged that this minor plus-point was negated as combined drops in the new orders and inventories indexes (4.2 points) exceeded the increase in the production Index (3.2), rendering the manufacturing PMI improvement negligible.
“Last month’s increase in new orders (an index gain of 4.3 percentage points from July to August) seems to have flowed through to production but does not appear to be sustainable given the subsequent drop in new orders in September,” said Spence.