NAM Monday Economic Report - June 8, 2026

Manufacturing Shows Resilience Amid Challenges

• Manufacturing employment gains in May: Manufacturing employment stepped up by 7,000 in May after staying the same in April. Meanwhile, nonfarm payroll employment rose by 172,000 in May, coming in above expectations. At the same time, the unemployment rate stayed the same at 4.3%, while the labor force participation rate was unchanged at 61.8%.
• Why it matters: Following the better-than-expected nonfarm job gain in May, the 12-month average sits at 42,000 job gains per month. Overall, gains were led by leisure and hospitality, jumping 70,000 ahead of the summer. At the same time, manufacturing employment is down 46,000 over the year but up 25,000 since the start of the year amid expanding activity.

• Manufacturing activity expands for the fifth consecutive month in May: The ISM Manufacturing® PMI expanded at a faster pace in May, increasing to 54.0% from 52.7% in April. New orders and output strengthened as the New Export Orders Index moved into expansion territory following contraction in April. Meanwhile, the Prices Index decreased 2.5 percentage points in May to 82.1% following a jump in April.
• What it means: Demand indicators remain broadly positive; however, the conflict in the Middle East continues to impact prices. Roughly 66.3% of companies report paying higher prices, down from 70.3% in April but much higher than the 21.0% reported in January 2025. Looking forward, continuing pricing and supply pressures could dampen the growth seen in activity.

• Manufacturing job openings rose in April: Job openings for manufacturing increased by 24,000 to 474,000 in April. The manufacturing job openings rate ticked up to 3.6% from 3.4% and is up from 2.9% the previous year. Meanwhile, the hires rate for manufacturing edged down to 2.3% from 2.4% in March, while the separations rate, which includes quits, layoffs, discharges and other separations, stayed the same at 2.2%, though down from 2.5% the year prior.
• What is shows: Consistent with increased demand, job openings in manufacturing remain above the 2025 average. At the same time, job openings in the overall economy grew by 731,000, hitting a two-year high at 7.6 million. Despite the increase in openings, the hiring rate for manufacturing and the overall economy stepped down in April.

• Other PMI measures also show expanding manufacturing activity: The S&P Global Manufacturing PMI was 55.1 in May, up from the April reading of 54.5 and above the 50 threshold that indicates growth in activity. Production rose at its fastest pace in over four years as new orders continued to grow but at a softer pace than in April. The conflict in the Middle East continues to drive up cost as input and output inflation both rose at the fastest pace since 2022.
• Why it matters: The conflict in the Middle East drove increased demand in May, as companies continue to purchase safety stock to avoid price increases and supply shortages. Therefore, the surge in new orders is unlikely to be sustained, providing a downside risk to production going forward.

• Global manufacturing expanded despite price pressures: In May, growth in global manufacturing was unchanged at 52.6, a reading that indicates growth in activity. Output and new orders both grew as manufacturing production hit a near five-year high. At the same time, lead times remained elevated at the greatest level since August 2022.
• What it shows: Manufacturing production rose for the 10th consecutive month as output in intermediate and investment goods industries hit 58-month and 53-month highs, respectively. Despite the gain in output, optimism dipped to a seven-month low as input and output price pressures continued to surge. Furthermore, part of the rise in production can be attributed to companies building safety stock ahead of anticipated supply chain disruptions and further cost increases.

• Strong demand continues to drive growth in factory orders: New orders for manufactured goods increased 4.8% in April after rising 1.8% in March. When excluding transportation, new orders moved up 1.3%. At the same time, orders for durable goods jumped 8.0% in April and are up 9.3% from the year prior.
• What it means: Factory order growth in April was the strongest since May 2025 as orders for commercial aircraft surged. At the same time, machinery continues to see high demand, with industrial machinery up 34.9% year-over-year.

Written by: Victoria Bloom and Michael Green, for NAM.