The Institute for Supply Management's Manufacturing PMI rose to 55.6 percent in July, up from 53.3 percent in June [1]. That 2.3-point gain is the highest reading since May 2022, and it marks the seventh straight month of manufacturing expansion, since any reading above 50 percent signals growth [1].
The detail that stands out is hiring. The employment sub-index climbed to 52.8 percent, up 3.1 points, its first expansion in about 33 months [1]. The prior month's reading sat below the 50 line, so July is the point where factory employment crossed from contraction back into growth. New orders registered 56.7 percent and production reached 58.5 percent, the strongest production reading since November 2021 [1].
Cost pressure eased slightly without going away. The prices index came in at 71.1 percent, down 1.9 points from the prior month but still well above the neutral line, which means manufacturers are broadly paying more for inputs [1]. According to ISM, a PMI of 55.6 percent "corresponds to a 2.8-percent increase in real GDP on an annualized basis" [1].
This reading cuts against the story dominating recent business headlines, the wave of white-collar and office layoffs. The two do not belong in the same sentence as one labor-market verdict. The ISM survey polls manufacturing purchasing managers about factory-sector activity; it does not measure office employment, technology payrolls, or professional services. A factory index turning up and a run of corporate layoffs can be true at once because they describe different slices of the economy, and merging them into a single claim would misstate both.
Two cautions belong on the manufacturing number itself. It is one month, and it is a diffusion index, which tracks the breadth of change rather than the size of it, so 52.8 percent tells us more firms are adding workers than cutting them, not by how much. The employment reading also sits only marginally above 50, a turn worth watching rather than a boom.
