Manufacturing activity contracted in November, according to surveys of companies’ purchasing managers in the Midwest and nationwide.
Nationally, the Institute for Supply Management said its manufacturing index based on surveys fell to 48.6 in November. Any reading below 50 indicates a contraction in economic activity. The group said its manufacturing index hadn’t been below 50 in three years, registering 50.1 in October.
Similarly, Creighton University said its index based on surveys in nine states, including Missouri and Kansas, fell to 40.7 in November. It had been 41.9 in October, with both readings signaling a contraction in activity.
“Since our survey oversamples manufacturing firms, it is not surprising that our overall index has weakened significantly for states and industries heavily dependent on agriculture and energy, which are being hammered by a strong U.S. dollar,” economist Ernie Goss said in the Creighton report.
A rising dollar makes U.S.-made goods more expensive to foreign buyers, whose currencies lose purchasing power when converted to dollars to pay for goods.
Creighton’s separate index for Missouri fell to 41.9 in November from 50.1 in October. Kansas continued to show contraction with an index at 42.6, up from 41.7 in October.
These reports follow a similar survey of credit managers in November. It still showed index readings above 50, indicating continued growth, though weaker than in October.