Manufacturing Weekly Brief: May 27–June 2, 2025
The U.S. manufacturing sector navigated a complex week, grappling with continued economic contraction and the pervasive uncertainty from shifting trade policies and tariffs. Despite these headwinds, the industry saw ongoing advancements in artificial intelligence (AI), automation, and sustainable practices, offering crucial pathways for operational resilience. Strategic initiatives in workforce development also continued to address the critical skills gap, essential for the industry’s long-term vitality.
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U.S. Manufacturing Activity Contracts for Third Month
The Manufacturing ISM® Report On Business® indicated that economic activity in the U.S. manufacturing sector contracted for the third consecutive month in May, with the PMI registering 48.5 percent. This slight decrease from April’s 48.7 percent reflects softening demand, ongoing tariff impacts, and general economic uncertainty. New export orders showed a stronger contraction, and suppliers are passing tariff-related costs directly to customers, contributing to a cautious market environment.
Published: June 2, 2025
Manufacturing PMI® at 48.5%; May 2025 Manufacturing ISM® Report On Business® -
S&P Global PMI Shows Manufacturing Expansion Amid Tariff Concerns
In contrast to the ISM report, the S&P Global US Manufacturing PMI for May rose to 52.0, indicating solid expansion and the best performance since February. This growth was primarily driven by an uplift in new domestic orders and an unprecedented increase in input inventories, as manufacturers and clients strategically “front-ran” anticipated tariff-related price increases and supply disruptions. Despite this, international sales remained subdued due to trade policies.
Published: June 2, 2025
https://www.pmi.spglobal.com/Public/Home/PressRelease/ed3c6f6ea79843648c9b8b98824d74f7 -
Tariff Uncertainty Continues to Stall Manufacturing Growth
The manufacturing industry’s ongoing struggle with tariff policies continued in May, leading to stalled growth, decreased demand, and increased prices. While production saw a slight rise, inventory backlogs dwindled as companies used up inputs pulled forward to avoid upcoming tariffs. Uncertainty remains a central theme, with tariff concerns accounting for 86% of headline comments in the ISM report, making long-term planning difficult for businesses.
Published: June 2, 2025
Manufacturing continues to stall as the industry grapples with tariff uncertainty: PMI | Packaging Dive
Tools & Tips
- Embracing AI-Driven Predictive Maintenance
Manufacturers are increasingly leveraging AI and machine learning to predict equipment failures with high accuracy, enabling proactive maintenance. This approach minimizes costly downtime, reduces emergency repairs, and extends equipment life, leading to significant improvements in overall operational efficiency and cost savings.
7 Manufacturing Industry Trends Driving Change in 2025
Fun Fact
Did you know? For every $1.00 spent in manufacturing, there is a total impact of $2.64 to the overall U.S. economy. This figure represents one of the largest sectoral multipliers in the economy, highlighting manufacturing’s significant contribution to national economic growth.
Facts About Manufacturing - NAM
We’d love to hear from you!
Have you participated in any Manufacturing events or utilized new Manufacturing tools recently? Share your experiences or insights with us—we’re featuring selected community voices in next week’s edition.