US Manufacturing Sector NAICS 31-33

Aug 20, 2025 - US Manufacturing Contracts Again in July

• US factory activity contracted in July at the fastest pace in nine months, dragged down by a faster decline in employment as orders continued to shrink, Bloomberg reports. July marked the fifth consecutive month that factory activity in the US declined. The Institute for Supply Management’s purchasing managers’ index (PMI) fell to 48 in July from 49 the prior month. The five-month stretch of contraction followed a two-month expansion preceded by 26 months of contraction. The production index rose to 51.4 in July from 50.3 the prior month. New orders rose to 47.1 in July from 46.4, showing slowing contraction. (Readings above 50 signal growth, while below that level signals contraction.) Manufacturers and their customers have become more cautious amid President Trump's volatile tariff policies, depressing demand for manufactured goods and, with it, demand for resin, plastic, rubber, and fiber materials.
• In June, GE Appliances announced it will spend nearly $500 million to reshore production of its washing machines from China to Louisville, Kentucky, a move that would create 800 jobs, The Wall Street Journal reports. The iconic American company said that while the move had been planned for sometime, the Trump administration’s steep tariffs on China hastened the decision, according to WSJ. GE said it will make front-loading washers and combination washer-dryers at its factory in Kentucky, with production set to begin in 2027. President Trump’s aggressive tariff agenda is causing more manufacturers to consider reshoring. Other major companies to make announcements this year about expanding US-based operations include Ford, Intel, Nvidia, and Apple. Advances in robotics and AI-driven automation have narrowed the labor cost gap between the US and lower-wage countries like China.

• While President Trump says tariffs will be a boon for American manufacturing, in the short term, at least, tariffs are making life harder for US manufacturers, the National Association of Manufacturers reports. The president of Ohio-based copper wire products maker Republic Wire told the Cincinnati Enquirer that while he understands what the administration is trying to achieve with tariffs, “Higher prices on materials could mean fewer construction projects, which could mean a slowdown for the industry, fewer jobs and a drag on the economy as a whole.” Chuck Daras, president and COO of Michigan automotive manufacturing firm AlphaUSA, wrote in an op-ed “The truth [about tariffs] is that the burden falls squarely on American manufacturers and, ultimately, the American consumer,” adding “If the tariffs remain in place long term, small manufacturers might not be able to hold out long enough to see their promised benefit.”
• Producer prices for all US manufacturing industries rose 1.5% in July compared to a year ago, after rising 1.8% in the previous July-versus-July annual comparison, according to the latest US Bureau of Labor Statistics data. Employment by US manufacturing companies shrank 0.9% year over year in July, while average sector wages rose 3.7% over the same period to a new high of $28.95 per hour, BLS data show. Despite historically high wages, US manufacturers, especially makers of durable goods, are struggling to hire workers. The sector lost a total of about 26,000 jobs in May and June, and another preliminary estimate of 11,000 jobs in July, per the BLS.