NEW YORK, Nov 1 (Reuters) - The pace of growth in the U.S. manufacturing sector hit a one-year-low in October as factory output slowed sharply, an industry report showed on Friday.
Financial data firm Markit said its final U.S. Manufacturing Purchasing Managers Index stood at 51.8 last month. That was better than an initial estimate of 51.1 but still a point below September’s reading and the worst final showing since October, 2012.
A reading above 50 indicates expansion in the sector
A sharp slowdown in output, which at 50.6 was the lowest in 13 months, was the main drag on growth. The subindex stood at 55.3 in September. New orders from domestic customers also slowed, though overseas demand rose slightly.
Chris Williamson, chief economist at Markit, said a partial government shutdown in the first half of October likely contributed to the slowdown in output and growth.
Firms hired workers at a slightly faster rate in October, however, with the subindex rising to 52.7 from 51.3.
Williamson said that might suggest manufacturing’s woes in October will prove temporary.
“However, even the faster growth of employment remains only modest, consistent with barely any increase in official data on manufacturing payrolls,” he said.
Job growth in the broader U.S. economy was tepid in September, and economists polled by Reuters expect a government report due on Nov. 8 to show hiring slowed further in October.
The Markit data has lately painted a gloomier picture of the manufacturing sector than data from the Institute for Supply Management, which showed U.S. factories saw their fastest pace of growth in nearly 2-1/2 years in September.
The ISM will release its October index at 10 a.m. on Friday (1400 GMT).
The two surveys use some different methodologies, including one related to seasonal adjustment.