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Overview of the November 2025 ISM Manufacturing PMI Report

The ISM Manufacturing PMI report for November 2025 shows a continued contraction in the manufacturing sector for the ninth month in succession. The reported PMI is at 48.2%, reflecting a decrease of 0.5 percentage points from October's 48.7%. This sustained decline comes after a period of expansion that lasted for only two months, which followed an extensive 26-month contraction phase. Manufacturing performance is closely linked to broader economic health, and this PMI reading suggests caution as economic activity appears to stagnate.

Key Metrics from the Report

New Orders and Production

• - New Orders Index: The New Orders Index decreased to 47.4%, a drop of 2 percentage points from October, marking the third consecutive month of contraction in new orders. This points towards a weakening demand from customers, essential for sustaining growth in manufacturing.

• - Production Index: In contrast, the Production Index shows some positive movement, registering 51.4%, an increase of 3.2 percentage points from October. This indicates that while new orders are slowing, production has picked up slightly, suggesting that manufacturers may be responding to any backlog they have from previous months.

Employment and Supplier Deliveries

• - Employment Index: Employment figures show a contraction with an index of 44%, two percentage points lower than the previous month. This continued reduction in workforce highlights the uncertainty faced by manufacturers regarding future demand and their corresponding labor needs.

• - Supplier Deliveries: For the month of November, the Supplier Deliveries Index returned with a reading of 49.3%, representing faster deliveries after three months of slowness. A reading below 50 indicates improvement in deliveries, which is generally a positive sign for supply chains.

Inventories and Price Fluctuations

• - Inventories Index: The Inventories Index registered at 48.9%, indicating a contraction in inventory levels, albeit at a slower pace than in October. This situation can be viewed positively since inventory management is critical for operational efficiency.

• - Prices Index: The Prices Index indicates that prices are increasing, with a reading of 58.5%. This marks the 14th consecutive month of price increases, predominantly driven by rising raw material costs and global supply chain pressures, particularly in the steel and aluminum sectors.

Commentary from ISM Chair

Susan Spence, MBA, Chair of the ISM Manufacturing Business Survey Committee, provided insights into the report's implications. She noted that while manufacturing outcomes are contracting at a faster rate, the contrast in performance across different indices reflects a complex economic environment. The discrepancies between the declining New Orders and improving Production Index suggest that manufacturers are currently focusing on improving efficiency rather than increasing headcount.

Challenges Ahead

Economic uncertainty, particularly surrounding tariff impacts and fluctuating costs, is leading many manufacturers to adopt a conservative stance on hiring and production expansion. Tariffs have created additional costs for many businesses, leading to fewer orders as clients hesitate to commit to new purchases amidst rising prices.

Conclusions

The November ISM Manufacturing PMI report illustrates a manufacturing sector struggling to maintain positive momentum amidst stark economic challenges. As manufacturers navigate through uncertain economic waters, the continuing slide in new orders alongside fluctuations in production indicates that strategic adjustments are crucial to weather the storm. The upcoming months will be vital as organizations adapt their strategies in response to these market dynamics, hopefully paving the way for eventual recovery.

Summary of Key Indices