PMI Index: Manufacturing Expanded During First Half of 2026

By SBE Council at 2 July, 2026, 11:49 am

by Raymond J. Keating -

U.S. manufacturing has experienced some expansion through the first six months of 2026, according to the latest read of the Institute of Supply Management's manufacturing PMI index.

The ISM manufacturing PMI experienced its sixth straight month of expansion in June, registering 53.3, as seen in the following table from the report, after 10 months of decline. A reading above 50 generally means that the manufacturing sector is expanding, and below 50 means it's contracting.

Susan Spence, Chair of the Institute for Supply Management Manufacturing Business Survey Committee, observed, "The Manufacturing PMI registered 53.3 percent in June, 0.7 percentage point lower than in May. The overall economy continued in expansion for the 20th month in a row."

According to ISM, "A Manufacturing PMI above 47.5 percent, over a period of time, generally indicates an expansion of the overall economy." Spence further explained, "The past relationship between the Manufacturing PMI and the overall economy indicates that June reading (53.3 percent) corresponds to a 2-percent increase in real gross domestic product (GDP) on an annualized basis."

Among 17 manufacturing sectors, 14 expanded in June: "The 14 manufacturing industries reporting growth in June - listed in order - are: Printing & Related Support Activities; Electrical Equipment, Appliances & Components; Textile Mills; Primary Metals; Apparel, Leather & Allied Products; Fabricated Metal Products; Computer & Electronic Products; Machinery; Plastics & Rubber Products; Transportation Equipment; Nonmetallic Mineral Products; Chemical Products; Miscellaneous Manufacturing; and Food, Beverage & Tobacco Products."

The three industries in contraction include: "Paper Products; Furniture & Related Products; and Wood Products."

Manufacturing expansion during the first half of 2026 according to the ISM index generally lines up with the manufacturing production data (i.e., actual physical output of manufacturing) from the Federal Reserve, with expansion in each month from January through April, and May being flat. The June data are yet to be released.

Finally, keep in mind that when talking about U.S. manufacturing, we're overwhelmingly talking about small businesses, with 93.1 percent of U.S. manufacturing firms having fewer than 100 employees.

Raymond J. Keating is chief economist for the Small Business & Entrepreneurship Council. He is the author of " The Weekly Economist " book series, and 10 Points from Walt Disney on Entrepreneurship .