With many regions experiencing supply chain issues and labor shortages, most of the global manufacturing countries tracked by Brushware saw a decline in PMI readings for August compared to July. Italy was the only country that showed an improved PMI reading. Despite the challenges, business optimism remained strong across most of the regions and countries tracked.

GERMANY: IHS Markit/BME reported a 62.6 percent August PMI for German manufacturers for a 3.3 percent drop from the previous month. Supply shortages caused output to significantly fall behind new orders. Increasing price pressure reduced business optimism, but employment rose for a sixth straight month as manufacturers looked to expand capacity. 

Global manufacturers saw varying results in the month of July as many countries face new headwinds with COVID-19 outbreaks hitting specific regions. Additionally, lead times are still extended with supply chain issues continuing. Firms are also facing labor challenges that pre-date the pandemic but have escalated during the past 18 months. Both issues lead to inflationary pressure with most regions reporting input and output price increases. Still, all countries in our report remain above the crucial 50 percent PMI line, but business confidence overall for manufacturers is slipping as companies weigh the impact of prolonged issues from the COVID-19 Delta variant.

GERMANY: IHS Markit/BME reported a PMI of 65.9 percent for German manufacturers in July, which represented a second straight month of growth and the third-highest figure on record. New orders were strong and led to a sharp increase in backlogs. Employment also saw a big increase.

India’s PMI sees a steep drop as COVID-19 strikes the country hard

For the most part, manufacturing showed strength in May as the Eurozone and four additional countries were comfortably above the 60 percent PMI level. UK manufacturers set the pace as the country surged with a 4.7 percent PMI increase to reach a new high of 65.6 percent. On the other hand, India struggled with a COVID-19 resurgence and reversed the UK number and fell by 4.7 percent to a 50.8 percent PMI reading.

Manufacturing PMI numbers across the world pushed up in April with only the US and Germany showing a decline from March. Of course, Germany and the US were still above the 60 percent mark and notably both Italy and the UK also pushed into the 60th percentile as well. Despite issues from COVID-19, Indian manufacturing grew by one-tenth, while China showed a strong bump of 1.3 percent to reach 51.9 for April. All countries reported strong business optimism despite supply-chain issues and COVID-19 concerns in India.

The latest Manufacturing ISM^® Report On Business^® issued by Timothy R. Fiore, Chair of the ISM^® Manufacturing Business Survey Committee reported a 60.7 percent PMI for April. That represented a decrease of four percentage points from the March reading of 64.7 percent.