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

FOR RELEASE: January 29, 2014

Contact:    Kristina Cahill
  ISM, ROB Media Relations
Report On Business® Analyst
  Tempe, Arizona
  800/888-6276, Ext. 3015
  kcahill@ism.ws

(Tempe, Arizona) — Based on input from an outside third party, Institute for Supply Management™ recently announced the completion of its annual adjustments 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 that changes are effective with the January 2014 ISM Manufacturing Report On Business®, which is scheduled to be released on February 3, 2014, and the January 2014 ISM Non-Manufacturing Report On Business®, which will be released on February 5, 2014.

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 one year ahead (2014).

As in previous years, the X12-ARIMA program was used to develop the revisions to the Manufacturing and Non-Manufacturing indexes for 2010 through 2013, as well as the 2014 projected seasonal factors. The 2014 seasonal factors will be recomputed when the actual data are known in early 2015. Projected seasonal factors for 2014 and revised seasonally adjusted indexes are shown below, followed by charts tracking both the former and the revised PMI® for Manufacturing and NMI® and Business Activity Indexes for Non-Manufacturing.




2014 Seasonal Adjustment Factors for ISM Manufacturing Indexes

  New
Orders

Production

Employment
Supplier
Deliveries
Jan 2014 1.054 0.985 0.976 1.012
Feb 2014 1.092 1.121 1.022 0.991
Mar 2014 1.107 1.092 1.037 1.027
Apr 2014 1.135 1.141 1.079 1.029
May 2014 1.064 1.033 1.061 1.015
Jun 2014 0.976 0.992 1.033 1.012
Jul 2014 0.907 0.947 0.980 1.026
Aug 2014 0.930 0.953 0.972 1.002
Sep 2014 0.959 0.937 0.970 1.006
Oct 2014 0.912 0.933 0.964 0.970
Nov 2014 0.932 0.955 0.957 0.951
Dec 2014 0.934 0.910 0.951 0.961

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). Note: As of January 2012, the ISM Manufacturing Inventories Index is no longer seasonally adjusted.

3)  Add all five index numbers together and divide by five.

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


2014 Seasonal Adjustment Factors for ISM Non-Manufacturing Indexes

  Business
Activity
New
Orders

Employment

Prices
Jan 2014 0.942 0.972 0.940 1.033
Feb 2014 1.017 1.052 1.021 1.089
Mar 2014 1.087 1.076 1.035 1.063
Apr 2014 1.051 1.039 1.073 1.044
May 2014 1.031 1.042 1.078 0.994
Jun 2014 1.008 0.989 1.085 0.996
Jul 2014 0.985 0.948 1.036 0.985
Aug 2014 0.961 0.948 0.980 0.971
Sep 2014 0.986 1.009 0.923 0.969
Oct 2014 0.967 0.956 0.931 0.970
Nov 2014 0.971 1.009 0.917 0.937
Dec 2014 0.996 0.960 0.982 0.950

To compute the NMI®:

1)  Calculate the unadjusted diffusion index for Business Activity, New Orders and Employment 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)  Add all four index numbers together and divide by four.

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


Revised Manufacturing Seasonally Adjusted Indexes 2010-2013

  PMI® New
Orders
Production Employment Supplier
Deliveries
Jan 2010 57.2 62.9 64.7 53.6 59.0
Feb 2010 55.8 57.1 58.4 54.6 59.8
Mar 2010 58.8 61.4 60.7 54.0 61.3
Apr 2010 58.1 62.4 63.0 55.6 58.9
May 2010 58.3 63.1 64.6 57.1 60.8
Jun 2010 56.4 60.0 62.2 55.9 57.8
Jul 2010 56.4 57.0 57.7 59.5 58.9
Aug 2010 58.0 56.9 60.7 62.1 57.1
Sep 2010 56.3 53.5 60.2 57.9 54.0
Oct 2010 57.7 59.5 63.5 59.5 52.9
Nov 2010 57.6 57.9 56.0 60.5 59.5
Dec 2010 57.5 59.8 62.5 58.2 57.0
 
Jan 2011 59.0 62.5 62.9 60.6 57.2
Feb 2011 59.3 61.9 63.5 61.5 59.2
Mar 2011 59.1 61.9 63.8 60.7 59.9
Apr 2011 58.9 60.4 60.7 59.7 59.2
May 2011 53.7 52.4 54.4 57.2 55.9
Jun 2011 56.6 55.7 57.3 60.3 56.4
Jul 2011 52.9 54.9 54.3 56.1 51.4
Aug 2011 53.0 52.1 51.7 54.9 52.0
Sep 2011 52.8 51.6 53.7 54.8 51.9
Oct 2011 51.8 52.4 52.8 55.1 52.0
Nov 2011 52.1 55.2 54.4 53.0 51.3
Dec 2011 53.1 55.4 59.9 55.0 49.9
 
Jan 2012 52.8 55.2 54.3 54.0 50.8
Feb 2012 52.4 55.2 55.5 53.6 48.4
Mar 2012 53.0 55.5 56.5 54.6 48.6
Apr 2012 53.7 55.8 59.2 56.5 48.7
May 2012 53.2 57.1 56.6 56.0 50.2
Jun 2012 51.0 51.3 53.8 55.8 50.0
Jul 2012 50.6 50.3 50.6 53.3 49.6
Aug 2012 51.1 49.6 49.5 52.9 50.3
Sep 2012 52.2 53.5 51.9 54.3 50.6
Oct 2012 51.2 51.8 51.9 53.1 49.4
Nov 2012 49.5 51.4 52.2 48.8 50.2
Dec 2012 50.4 50.1 53.1 52.7 52.9
 
Jan 2013 52.3 50.8 53.8 53.8 51.9
Feb 2013 53.1 55.7 54.5 52.2 51.5
Mar 2013 51.5 51.7 53.9 52.1 50.4
Apr 2013 50.0 49.7 52.1 50.5 51.1
May 2013 50.0 49.6 52.5 49.0 49.7
Jun 2013 52.5 55.7 55.7 50.0 50.4
Jul 2013 54.9 59.1 60.8 55.5 52.0
Aug 2013 56.3 63.6 63.0 55.0 52.4
Sep 2013 56.0 61.3 61.2 54.8 52.7
Oct 2013 56.6 61.3 60.8 54.3 54.1
Nov 2013 57.0 63.4 62.4 55.4 53.3
Dec 2013 56.5 64.4 61.7 55.8 53.7

The revised breakeven point for the overall economy is a PMI® of 43.2 percent. A PMI® over 43.2 percent indicates an expanding overall economy. A PMI® below 43.2 percent indicates the overall economy is declining. The ISM Manufacturing Inventories Index is no longer seasonally adjusted as of January 2012.


Revised Non-Manufacturing Seasonally Adjusted Indexes 2010-2013

  NMI® Business
Activity
New
Orders
Employment Prices
Jan 2010 49.6 51.5 51.4 44.8 59.5
Feb 2010 50.8 53.0 50.8 46.0 58.7
Mar 2010 53.2 57.7 58.3 47.4 60.7
Apr 2010 55.6 59.8 59.7 49.3 64.0
May 2010 55.5 61.3 58.0 49.6 60.0
Jun 2010 54.6 59.4 57.6 48.5 56.8
Jul 2010 54.8 57.4 58.9 50.7 56.0
Aug 2010 52.7 55.8 55.1 48.9 58.3
Sep 2010 53.6 53.3 54.7 51.5 60.3
Oct 2010 55.3 59.7 58.4 52.1 69.7
Nov 2010 56.7 59.1 58.4 56.6 65.4
Dec 2010 57.0 62.2 62.0 52.2 69.2
 
Jan 2011 57.1 61.6 61.2 52.1 69.8
Feb 2011 56.9 63.3 58.8 53.6 68.9
Mar 2011 55.5 58.2 59.3 52.9 70.7
Apr 2011 55.3 56.9 57.5 53.6 71.4
May 2011 55.0 55.0 56.4 54.4 70.0
Jun 2011 54.2 55.7 56.1 52.9 63.7
Jul 2011 53.8 56.6 54.6 53.3 62.0
Aug 2011 54.1 56.5 55.0 51.9 60.9
Sep 2011 52.7 56.8 55.2 49.4 61.5
Oct 2011 52.9 53.9 53.5 52.3 58.1
Nov 2011 53.2 56.1 53.5 53.1 62.9
Dec 2011 52.6 55.6 54.3 49.0 61.3
 
Jan 2012 55.6 58.7 57.8 54.9 61.2
Feb 2012 54.9 59.9 57.0 53.2 63.9
Mar 2012 55.1 58.5 57.1 55.2 65.0
Apr 2012 54.5 56.0 55.8 54.5 56.9
May 2012 54.4 56.4 56.1 51.9 53.8
Jun 2012 53.3 53.6 55.9 52.5 51.0
Jul 2012 52.9 56.2 55.6 50.3 56.5
Aug 2012 53.8 55.3 55.0 53.3 62.1
Sep 2012 55.3 60.2 56.3 53.2 66.1
Oct 2012 54.5 56.1 55.7 54.7 61.4
Nov 2012 55.1 60.9 57.3 53.3 57.5
Dec 2012 55.7 60.0 59.1 55.2 55.7
 
Jan 2013 54.9 56.4 55.0 55.6 57.1
Feb 2013 54.8 56.3 56.0 55.5 57.4
Mar 2013 54.5 56.6 55.2 53.2 56.4
Apr 2013 53.8 55.9 55.7 52.6 53.0
May 2013 54.0 57.0 56.6 50.3 54.4
Jun 2013 53.4 53.3 54.0 54.9 56.5
Jul 2013 55.9 59.5 57.7 53.9 58.3
Aug 2013 57.9 61.0 59.7 56.3 53.6
Sep 2013 54.5 55.8 58.1 54.1 56.9
Oct 2013 55.1 58.9 56.4 56.0 56.2
Nov 2013 54.1 55.3 55.7 54.5 52.7
Dec 2013 53.0 54.3 50.4 55.6 54.7

Charts Illustrating Former and Revised Indexes

ISM Manufacturing PMI® Chart: 2010-2013

ISM Non-Manufacturing Index (NMI®) Chart: 2010-2013


The ISM Report On Business® is considered by many economists to be the most reliable near-term economic barometer available. It is reviewed regularly by top government agencies and economic and business leaders for its timely, accurate information. The Manufacturing and Non-Manufacturing ISM Report On Business® is published monthly by the Institute for Supply Management™, the first supply institute in the world. Each month, both reports are compiled from responses to questions asked of purchasing and supply executives across the country and reflects change, if any, in the current month compared to previous months. Institute for Supply Management™ (ISM) is the first supply management institute in the world. Founded in 1915, ISM's mission is to enhance the value and performance of procurement and supply chain management practitioners and their organizations worldwide. By executing and extending its mission through education, research, standards of excellence and information dissemination — including the renowned monthly ISM Report On Business® — ISM maintains a strong global influence among individuals and organizations.



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