The Institute for Supply Management’s (ISM) monthly measure of manufacturing activity rose to its highest level since 1983 in March.
The closely watched Manufacturing PMI rose to 64.7 percent, up 3.9 points from February and the highest since the 69.9 percent reading in December 1983.
“Manufacturing performed well for the 10th straight month, with demand, consumption and inputs registering strong growth compared to February,” Timothy Fiore, chair of the ISM’s Manufacturing Business Survey Committee, said in a statement.
Some of the increase may have reflected a rebound from February, when harsh winter storms hit the country and disrupted supply chains and delivery.
Despite the March boost, however, Fiore said manufacturers expressed concern over ongoing challenges.
“Survey Committee Members reported that their companies and suppliers continue to struggle to meet increasing rates of demand due to coronavirus (COVID-19) impacts limiting availability of parts and materials,” he said. “Extended lead times, wide-scale shortages of critical basic materials, rising commodities prices and difficulties in transporting products are affecting all segments of the manufacturing economy.”
One of the persistent problems, he added, was the difficulty in finding workers and broader labor issues linked to the coronavirus pandemic.
The news comes as the economy shows continued signs of improvement following a severe winter spike in COVID-19 cases, a recent uptick in vaccinations, and the passage of the $1.9 trillion COVID-19 relief bill.
On Wednesday, payroll company ADP reported more than 500,000 new private sector jobs, and economists are expecting even more in the Labor Department’s monthly jobs report due Friday.