Albuquerque Commercial Real Estate

"Institute for Supply Management Indexes"

Values > 50 = Expansion

The Institute for Supply Management maintains two indexes measuring business conditions, one for the manufacturing sector and a non-manufacturing index that measures the service sectors. Both indexes are pointing toward better times ahead for the economy. The ISM manufacturing index hit 60.8 in January, its highest level since June 2004 and well above the 50 threshold that indicates expansion The new orders component of the index, a leading indicator of production, sits at a robust 67.8 while the employment component sits at 61.7, which means that manufacturers are hiring again. This was confirmed by the Labor Department’s January employment situation report showing a gain of 49,000 manufacturing jobs in an otherwise lackluster month. The ISM non-manufacturing index increased to 59.4 in January, the highest level in the three-year history of the survey. The new orders and employment components of the non-manufacturing index rose to 64.9 and 54.5, respectively. The strong ISM indexes point to improvement in GDP and the labor market later this year, all of which should give an assist to the commercial real estate leasing markets.

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