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2006 U.S. Department Of Commerce Annual Adjustments to Seasonal Factors

FOR RELEASE: January 25, 2006

Contact: Rose Marie Goupil
  ISM, Media Relations
  Tempe, Arizona
  800/888-6276, ext. 3015
  rgoupil@ism.ws

U.S. Department Of Commerce Makes Annual Adjustments to Seasonal Factors for ISM Manufacturing PMI and Diffusion Indexes and ISM Non-Manufacturing Diffusion Indexes

(Tempe, Arizona) — The U.S. Department of Commerce recently completed its annual adjustment to the seasonal factors used in the monthly Institute for Supply Management™(ISM) Manufacturing Report On Business® and the monthly Institute for Supply Management™ (ISM) Non-Manufacturing Report On Business®. Economists and managers who track these indexes will note these changes are effective with the January 2006 ISM Manufacturing Report On Business®, which is scheduled to be released on February 1, 2006 and the January 2006 ISM Non-Manufacturing Report on Business®, which will be released on February 3, 2006.

Seasonal adjustment factors are used to allow for the effects of repetitive intra-year variations resulting primarily from normal differences in weather conditions, various institutional arrangements, and differences attributable to non-movable holidays. It is standard practice to project the seasonal adjustment factors used to calculate the indexes a year ahead (2006).

The X12-ARIMA program was used to develop the revisions to the indexes for 2002 through 2005 as well as the 2006 projected seasonal factors for Manufacturing. Due to the shorter history for the Non-Manufacturing Report, these indexes have been revised from 1997 through 2005. The 2006 seasonal factors will be recomputed when the actual data are known in early 2007. Projected seasonal factors for 2006 are listed on the next page. Revised indexes for all other indicators are shown on pages 3 through 6, followed by charts tracking both the former and the revised PMI and Business Activity Index for Non-Manufacturing on page 7.

As part of the Department of Commerce's annual review, the Manufacturing Imports series will no longer be seasonally adjusted, effective with the January 2006 seasonal adjustments.

Annual Adjustments to Seasonal Factors for ISM Manufacturing PMI and Diffusion Indexes and
ISM Non-Manufacturing Diffusion Indexes


2006 Seasonal Adjustment Factors for ISM Manufacturing Indexes

(Prepared by G. McKittrick, Economist, U.S. Department of Commerce, 202/482-2343)

  New
Orders
Production Employment Supplier
Deliveries
Inventories Export
Orders
January 2006 0.982 0.998 0.995 0.968 1.021 1.000
February 2006 1.026 1.027 0.991 0.996 1.049 0.991
March 2006 1.071 1.043 1.028 1.016 1.026 1.039
April 2006 1.068 1.051 1.021 0.997 1.004 1.029
May 2006 1.034 1.022 1.058 1.015 1.010 1.015
June 2006 1.001 0.998 1.058 1.018 1.012 1.020
July 2006 0.980 0.955 1.006 1.011 0.950 0.993
August 2006 0.968 0.946 0.963 1.018 1.016 0.978
September 2006 1.015 1.025 0.972 0.998 1.013 0.976
October 2006 0.951 0.983 0.955 1.005 0.961 0.969
November 2006 0.976 0.989 0.986 0.985 0.956 1.002
December 2006 0.931 0.965 0.966 0.974 0.982 0.986
             
Weight .30 .25 .20 .15 .10 (Not part
of PMI)


To compute the PMI:
  1. Calculate the unadjusted diffusion index for New Orders, Production, Employment, and Inventories to two decimal places (percent higher or up plus one half of the percent same or unchanged). For Supplier Deliveries, it will be percent slower plus one half of the percent same or unchanged.

  2. Divide each unadjusted diffusion index by its seasonal factor (round to one decimal place).

  3. Multiply each seasonally adjusted diffusion index by its weight, then add all five together.

To compute other indexes, follow steps #1 and #2 above for each indicator.



2006 Seasonal Adjustment Factors for ISM Non-Manufacturing Indexes

  Business
Activity
New
Orders
Employment Prices
January 2006 0.924 0.964 0.969 0.990
February 2006 0.990 1.005 0.954 1.041
March 2006 1.049 1.016 1.007 1.075
April 2006 1.055 1.022 1.035 1.078
May 2006 1.023 1.032 1.017 0.974
June 2006 1.061 1.061 1.057 0.988
July 2006 1.022 1.026 1.037 0.982
August 2006 0.965 0.998 0.992 0.967
September 2006 1.002 0.971 0.961 0.997
October 2006 0.980 0.956 0.981 1.011
November 2006 0.993 0.990 1.007 0.963
December 2006 0.937 0.956 0.985 0.939


Revised Manufacturing Seasonally-Adjusted Indexes 2002-2005

  PMI New
Orders
Production Employment Supplier
Deliveries
Inventories Export
Orders
Jan 2002 49.1 55.2 51.1 41.0 51.2 39.2 50.1
Feb 2002 53.2 60.7 58.1 43.8 51.4 39.7 50.7
Mar 2002 55.0 63.8 58.3 46.6 51.9 41.4 50.6
Apr 2002 54.4 59.9 59.1 46.6 53.5 43.0 51.9
May 2002 55.2 61.8 59.4 47.3 53.4 43.8 53.3
Jun 2002 55.8 61.2 61.1 48.3 54.4 43.2 54.1
Jul 2002 51.2 51.9 56.6 45.0 54.8 42.7 52.2
Aug 2002 50.9 50.6 54.9 46.8 53.6 45.4 53.4
Sep 2002 51.3 52.9 53.5 45.8 56.7 43.8 53.8
Oct 2002 50.0 52.1 51.3 46.4 53.4 42.0 53.0
Nov 2002 49.2 49.9 52.7 44.8 52.1 43.1 50.0
Dec 2002 53.1 58.7 53.9 47.5 52.9 45.2 52.0
               
Jan 2003 52.8 58.7 54.1 46.6 52.8 44.1 54.4
Feb 2003 49.9 52.4 53.1 43.1 52.8 43.1 55.2
Mar 2003 46.4 46.7 47.3 42.2 52.5 42.4 51.3
Apr 2003 46.5 47.0 48.9 41.9 50.0 43.2 50.8
May 2003 50.0 53.0 53.4 42.7 50.8 45.6 51.7
Jun 2003 50.5 53.9 54.3 45.5 49.8 41.6 54.6
Jul 2003 52.3 56.6 54.7 46.2 51.5 46.6 54.4
Aug 2003 55.5 61.0 61.9 47.1 53.1 43.2 56.4
Sep 2003 54.4 60.5 58.5 46.4 53.2 43.1 54.5
Oct 2003 57.2 64.2 62.2 48.6 54.4 45.5 59.5
Nov 2003 60.6 69.3 65.3 50.4 56.2 49.9 57.1
Dec 2003 63.2 71.6 69.1 54.6 59.2 45.9 59.3
               
Jan 2004 62.9 70.4 68.5 53.1 61.6 47.7 57.2
Feb 2004 62.2 67.5 65.2 56.7 62.9 49.0 55.1
Mar 2004 62.3 65.4 66.2 56.8 66.6 48.2 60.2
Apr 2004 63.0 67.0 67.2 57.7 67.1 45.2 59.9
May 2004 62.9 63.9 65.8 60.8 68.5 48.6 60.0
Jun 2004 61.5 61.8 64.0 59.2 66.9 50.4 57.3
Jul 2004 61.5 63.2 65.0 57.2 64.5 51.3 56.7
Aug 2004 59.6 61.7 60.5 56.4 62.9 52.3 55.8
Sep 2004 58.0 57.4 60.4 57.9 59.7 51.0 53.5
Oct 2004 56.8 57.8 58.5 55.4 58.8 49.3 56.7
Nov 2004 56.9 59.5 56.6 56.9 56.6 50.6 54.5
Dec 2004 58.6 66.3 57.1 54.0 55.5 53.0 59.1
               
Jan 2005 56.3 57.3 57.4 56.9 54.1 52.5 56.5
Feb 2005 55.6 56.4 57.2 57.1 54.1 48.6 56.5
Mar 2005 55.3 57.2 56.9 53.0 52.7 53.7 55.1
Apr 2005 53.8 54.7 57.2 52.3 52.1 48.2 57.0
May 2005 51.8 51.9 55.7 49.1 51.2 47.8 55.3
Jun 2005 54.0 57.2 56.3 50.4 53.1 47.5 51.2
Jul 2005 56.4 60.0 60.5 53.2 52.3 47.9 55.8
Aug 2005 53.5 55.8 55.9 52.9 50.6 46.1 54.5
Sep 2005 58.0 60.7 61.7 53.1 58.6 49.0 57.3
Oct 2005 58.1 59.9 60.8 54.9 60.8 48.4 55.2
Nov 2005 57.3 58.5 60.2 56.0 56.9 49.3 57.9
Dec 2005 55.6 59.1 57.8 53.6 52.9 47.3 54.3


Annual Adjustments to Seasonal Factors Continued...



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