U.S. manufacturing shrinks to 3-year low in November

U.S. manufacturing shrank in November to its weakest level since July 2009—one month after the Great Recession ended—as worries about automatic tax increases in the new year cut demand for factory orders and manufacturing jobs. The Institute for Supply Management, a trade group of purchasing managers, says that its index of manufacturing conditions fell to a reading of 49.5. That’s down from 51.7 in October. Readings above 50 signal growth, while readings below 50 indicate contraction. Manufacturing grew in October for only the second time since May. A gauge of new orders also dropped to its lowest level since August, a sign that production could slow in the coming months. Manufacturers also sharply reduced their stockpiles, indicating companies expect weaker demand. “Today’s report suggests that the manufacturing sector is likely to remain a weak point in the recovery for a few months yet,” Jeremy Lawson, an economist at BNP Paribas, told his clients in a note today. The Associated Press has more details in the full story here.