WASHINGTON (AP) - U.S. manufacturers expanded at their slowest pace in two years last month, held back by faltering global growth and cutbacks in oil and gas drilling.
WASHINGTON (AP) — U.S. manufacturers expanded at their slowest pace in two years last month, held back by faltering global growth and cutbacks in oil and gas drilling.
The Institute for Supply Management says its index of factory activity fell sharply to 50.2 in September from 51.1 in August. That is the lowest level since May 2013. Any reading above 50 indicates expansion.
New orders and production both fell sharply and a measure of hiring also declined, according to the ISM, a trade group of purchasing managers. All three still barely remained in expansion territory.
U.S. manufacturers are getting hit by slower growth in China, the world's second-largest economy, and a stronger dollar, which makes U.S. goods more expensive overseas. Oil and gas drillers are also cutting back on their orders for steel pipe and other goods in the wake of sharply lower oil prices.
China's factory activity contracted last month, according to a survey of its purchasing managers, though its manufacturing index inched up to 49.8 from 49.7 in August.
Manufacturers cut 15,000 jobs last month, the most in five years, payroll services provider ADP said Wednesday. The government will release its jobs report Friday, and economists forecast it will show that the economy added 206,000 jobs overall. The unemployment rate is expected to remain at a seven-year low of 5.1 percent.
Most economists expect U.S. manufacturing will do little for the economy for the rest of the year, with the possible exception of automakers. But so far, healthy consumer spending on cars, homes and restaurant meals is offsetting overseas weakness and driving modest growth.