Manufacturing drops to nearly four-year low


Overall, manufacturing output has grown just 1.3 percent during the past 12 months and is "growth is well below what we need to see for positive job creation," he said. 

"Ideally, we would like to see manufacturing production grow by 4.5 percent or more annually on average," Moutray said. 

"To achieve higher growth and get manufacturing back on track Washington must act on pro-growth policies that will help make us more competitive, grow and create jobs."

Any reading under 50 reflects a contraction.

New orders fell to 48.8, from 52.3, the lowest level in nearly a year. The measure of production declined to 48.6 percent, from 53.5. 

"Stockpiles have fallen in five of the past seven months, which should be a positive if and when new orders pick up," Moutray said. 

Hiring dropped off slightly but remained in expansion territory at 50.1 percent, down from April’s reading of 50.2.

Some businesses said the economy is "sluggish and pensive" while some sectors were expecting price decreases that could amp up purchases. 

Others said the "downturn in European and Chinese markets is having a negative effect on our business" and others said demand was chugging along at a good clip before softening through the second half of April, partially caused by a slow down in domestic and foreign demand. 

Meanwhile, U.S. orders were impacted by reductions in government spending, according to a computer and electronic products manufacturer, and a transportation equipment leader noted the difficulty in hiring skilled employees.