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Economy in Brief

Business Activity Slips in October
by Kathleen Stephansen  October 30, 2020

• Employment remains weak.

The Chicago Purchasing Managers Business Barometer eased to 61.1 during October from 62.4 in September, but the sharp improvement from the May low of 32.3 is largely intact. Note that a reading above 50 suggests rising activity in the Chicago area.

Haver Analytics constructs an ISM-Adjusted Chicago Business Barometer with similar methodology to the ISM Composite Index. This measure dropped to 56.7 from 58.7 in September.

New Orders was the only category showing an uptick, albeit small, to 65 in October compared to 64.9 in September, while the production measure slipped to 62.1 from 67.9 in September. The report noted mixed signals from firms, with some describing a drop in demand while others seeing a stable level of orders and production.

Orders backlogs eased to 50.5 during October, down from 52.9 in September, and inventories were little changed at 47.7 from the 47.8 in September. Supplier deliveries declined to 65.3 from 67.4 in September, but remain elevated reflecting the current crisis.

Employment remains weak, with a reading of 43.2 down from 45.7 in September and well below the 50 level. Firms reported staff reductions related to the pandemic.

Factory prices kept largely stable in October, easing only slightly to 64.6 from 64.7 in September.

The MNI Chicago Report is produced by MNI in partnership with ISM-Chicago. The survey is collected online each month from manufacturing and non-manufacturing firms in the Chicago area. Summary data are contained in Haver's USECON database, with detail including the ISM-style index in the SURVEYS database.

Chicago Purchasing Managers Index (%, SA) Oct Sep Aug Oct '19 2019 2018 2017
General Business Barometer 61.1 62.4 51.2 44.3 51.3 62.4 60.8
ISM-Adjusted General Business Barometer 56.7 58.7 49.7 47.1 51.4 60.8 59.0
   Production 62.1 67.9 52.0 46.9 51.2 64.5 64.2
   New Orders 65.0 64.9 53.5 37.9 52.0 63.8 63.4
   Order Backlogs 50.5 52.9 46.2 35.2 46.9 58.0 55.2
   Inventories 47.7 47.8 37.3 46.3 48.7 55.4 54.9
   Employment 43.2 45.7 41.1 49.8 49.6 55.3 52.9
   Supplier Deliveries 65.3 67.4 64.5 54.5 55.6 64.8 59.4
   Prices Paid 64.6 64.7 55.0 54.8 58.5 73.9 64.0
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