Food Industry Reports Continued Growth, Labor Shortages in November ISM Report

Labor shortages are affecting production volumes, but the food industry is still expanding, according to the latest ISM report. The Purchasing Managers Index (PMI) currently sits at 59.3%, an increase over last month, but still 2 percentage points below the 12-month high.

Here’s what the food, beverage, and tobacco industry reported for November:

• Growth in new orders

• Growth in production

• Growth in employment

• Slower supplier deliveries

• No change in raw materials inventories

• Customer inventories too low

• Increased prices for raw materials

• Growth in order backlogs

• Growth in new export orders

• Growth in imports

Breaking the trend of the past few months, the average lead time for capital expenditures and maintenance, repair, and operating (MRO) supplies increased by 2 days each, to 152 and 35 days, respectively. The average lead time for production materials gave up its 1-day gain from October to return to 67 days.

Overall, November was the 115th straight month of growth for the overall economy and the 27th for the manufacturing sector.