As the White House and the Congress continue the political theater that will likely end in a last minute deal that delays action on rather than solves the fiscal woes that face the nation, the private sector continues to react.
And not in a good way
U.S. manufacturing shrank in November to its weakest level since July 2009, one month after the Great Recession ended. Worries about automatic tax increases in the new year cut demand for factory orders and manufacturing jobs.
The Institute for Supply Management said Monday that its index of manufacturing conditions fell to a reading of 49.5. That’s down from 51.7 in October.
Readings above 50 signal growth, while readings below indicate contraction
A measure of new orders fell to its lowest level since August, a sign that production could slow in the coming months
Worries about the fiscal cliff have led many companies to pull back this year on purchases of machinery and equipment
A measure of hiring in the ISM survey fell to 48.4, the lowest reading since September 2009
Companies “are just backing off and not making any moves until things clear up a bit,” Bradley Holcomb, chairman of the ISM's survey committee, said.