WHAT IS THE PMI? (PURCHASING MANAGERS' INDEX) What is the ISM Manufacturing Index? simecurkovic.com

Please reach out any time at: www.simecurkov...
Updated explanation of ISM MFG PMI, March 2023:
Explanation on the ISM PMI mfg. index (future supply chain managers - your future boss will read stuff like this and it is all over the news)
Students:
Note: make sure you understand how to interpret the ISM MFG index (also called the PMI - Purchasing Managers’ Index). For example, if it is above 50, what does that mean? If it is below 50, what does that mean?
Hot off the presses, March 2023:
(Tempe, Arizona) - Economic activity in the manufacturing sector contracted (shrunk) in March for the fifth consecutive month following a 28-month period of growth, say the nation's supply executives in the latest Manufacturing ISM® Report On Business®.
“The March Manufacturing PMI registered 46.3%.
IMPORTANT: Any number above 50 means mfg expanded from the previous month (they made more stuff). Any number under 50 means they made less stuff than the previous month. It has been under 50 for 5 months in a row (not good).
UP UNTIL 5 MONTHS AGO - This figure indicated expansion in the overall economy for 29 months in a row after contraction in 2020 - March, April, and May (covid). Covid shrunk the U.S. economy for only 3 months! Why did Washington pump $6T of stimulus into the economy?
Note, before the covid contraction in 2020 March, April, and May, the U.S. economy grew "131" consecutive months!!!
Did you catch that above? Pre-covid, the U.S. economy grew 131 months in a row! Note, pre-great recession, in 2008, the U.S. economy grew every month 1991-2007 (for the most part). The U.S. is a job creation machine! In fact, all indications are that the U.S. might be the only economy that was poised for a growth surge in 2021 through 2022 (with the exception of China). How do we keep doing it?! SCM? Note, the U.S. economy grew almost 10% in 2021, astronomical growth (too much).
If the ISM PMI MFG Index is above 50 for the month, then that simply means American mfg output expanded compared to the previous month. That is good because if it keeps being above 50 every month that means we are cranking out more and more stuff and that means jobs will be created.
So, covid hit us. What happened? In March, April, and May 2020, the PMI was under 50 (and it has been again the last 5 months). But, for June 2020, the PMI was above 50! If that number stays above 50 moving forward each month, that might mean the worst is behind us. Well, it has been above 50 since June 2020 (until the last 5 months). The Federal Reserve Board has been raising interest rates to slow down the economy to combat inflation, and it looks like it might actually be working.
Why does this ISM MFG index (the PMI) matter to the government and us? Answer: If MFG keeps shrinking month to month, our overall economy will start to shrink (eventually that means recession). You do not want to be graduating during a recession (though you will still be fine). Note, before manufacturing started shrinking 3 years ago during the covid shutdown (PMI under 50), the PMI was above 50 for the better part of 3 years (MFG was increasing).
OK, let's rehash this a bit...
Each month the Institute of Supply Management calculates this thing called the ISM Mfg. Index (also called PMI).
If an employer asked you what this meant or what the number meant, could you answer that interview question?
The U.S. government takes this calculation very seriously, but almost no one knows what it is. I was asked to explain it to the local community back in May of 2012. Make sure you know how to interpret this number and what the current data says about our economy.
www.mlive.com/...
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So where are we at now? Rehash...
(Tempe, Arizona) - Economic activity in the manufacturing sector contracted (shrunk) in March for the fifth consecutive month following a 28-month period of growth, say the nation's supply executives in the latest Manufacturing ISM® Report On Business®.
“The March Manufacturing PMI registered 46.3%. Remember- The ISM PMI Mfg Index has been above 50 for 29 straight months...until the last 5 months. That means they were cranking out more stuff, so what does that mean? Answer: they are hiring more people. You need more people eventually if you keep growing. Jobs! FYI: U.S. unemployment is 3.7% (near historic lows). Unemployment for people with college degrees is 1.9%. However, with mfg now cranking out less stuff we should see mfg creating fewer jobs. Well, unemployment is still at 3.7%. BUT, the number of unfilled open jobs in America has dropped from 11 million to 9.99 milliion.
In my opinion, if the ISM PMI gets back to be above 50, then we will avoid a recession, especially a LABOR recession. Remember, 1 factory job creates another 10-20 jobs for everywhere else.

[@loreall.2461]

Just fantastic information here, and I want to thank you very much. Here we are in June 2022. I’m a day trader really starting to dig into all these governmental and outside agency numbers trying to anticipate where we might be headed, trying to get a realistic read on Chair Powell’s thinking knowing this is exactly the data he reviews. I learned so much in this video, amazing!

[@simecurkovic]

Great news...The March ISM PMI MFG index just came in and it is above 50! If this continues moving forward, you will enjoy the job market even moreso. Note, even though the PMI shrunk the previous 16 months, the U.S. still avoided a recession. I hate to say it, but the government might have actually successfully orchestrated the avoidance of a recession (during a time when most people were predicting one). The worst thing for a college student is to graduate during a recession...I did in 1992 and I only had one job offer on the table to choose from, and hence I left for Kokomo, Indiana and lived next door to a camel farm. March ISM PMI MFG Index... Economic activity in the manufacturing sector expanded in March after contracting for 16 consecutive months, say the nation's supply executives in the latest Manufacturing ISM® Report On Business®. “The Manufacturing PMI® registered 50.3 percent in March, up 2.5 percentage points from the 47.8 percent recorded in February. The overall economy continued in expansion for the 47th month after one month of contraction in April 2020. Did you catch that? 47 consecutive months of economic growth in America. What does that mean for you? Answer: jobs creation.

[@simecurkovic]

Side note: My heart goes out to America’s working class. My immigrant father was a United Auto Workers (UAW) union worker for General Motors and we lived the American dream because of it. Those days are unfortunately gone because the American manufacturing laborer is competing against non-Americans who will work for much less money (around $1/hr in China and $4/hr in Mexico). Free trade agreements (NAFTA, CAFTA, WTO, etc.) with underdeveloped countries have perpetuated this situation. There will be no end in sight because the global economy revolves around generating shareholder value. The ability of American companies to invest abroad has benefited very large portions of our workforce, but it has also left several behind. This brings me to the real problem at several of America’s more mature manufacturing companies whose hourly workers tend to still have strong union representation. You can blame what might be overpaid hourly workers, but mismanagement is at the heart of the problem on both the management and union side. For example, the stock prices of these manufacturing dinosaurs has slipped because of an inability to generate a positive and large return on investment. Yes, these companies make money (sometimes and often), but its net income as a percentage of total sales is small and that turns investors away. The only way these companies can improve its return on investment is to widen margins and improve its asset turnover rate. Reducing their direct labor costs will widen margins and improve the return on investment. They could increase sales, but that is not easy in the saturated and competitive U.S. market which is still the largest economy in the world. I also realize that these companies are competing against companies that have much lower direct labor costs. However, where do most of their costs come from? Most of their costs come from direct material purchases and overhead (not direct labor). Another way to improve return on investment is to manage and reduce inventory because that would increase your asset turnover rate. My point is that management and union leadership have let its shareholders down more so than its hourly workers. Management needs to more effectively reduce its direct material and overhead costs, and better manage its assets such as inventory. They should work with their hourly workforce to implement lean manufacturing techniques that are proven methods for reducing costs and improving performance. The unions should also bend over backwards with open arms to help management implement these techniques. Fortunately, all of this is happening and will hopefully contribute to more positive news as is being reflected in a growing economy with record low unemployment. So where are we at now? Rehash... Economic activity in the manufacturing sector grew in October, with the overall economy notching a sixth consecutive month of growth, say the nation’s supply executives in the latest Manufacturing ISM® Report On Business®. “The October Manufacturing PMI® registered 59.3 percent, up 3.9 percentage points from the September reading of 55.4 percent and the highest since September 2018 (59.3 percent). This figure indicates expansion in the overall economy for the sixth month in a row after a contraction in April, which ended a period of 131 consecutive months of growth. Did you catch that above? Pre-covid, the U.S. economy grew 131 months in a row! Note, pre-great recession, in 2008, the U.S. economy grew every month 1991-2007 (for the most part). The U.S. is a job creation machine! If the ISM PMI MFG Index is above 50 for the month, then that simply means American mfg output expanded compared to the previous month. That is good because if it keeps being above 50 every month that means we are cranking out more and more stuff and that means jobs will be created. So, covid hit us. What happened? In March, April, and May, the PMI was under 50. Big surprise, right? But, for June - October, the PMI was above 50! If that number stays above 50 moving forward each month, that might mean the worst is behind us. Why does this matter to the government and us? Answer: If MFG keeps shrinking month to month, our overall economy will start to shrink (eventually that means recession). You do not want to be graduating during a recession (though you will still be fine). Note, before manufacturing started shrinking 4 months ago (PMI under 50), the PMI was above 50 for the better part of 3 years (MFG was increasing). Not surprisingly, the ISM Employment Index has been under 50 for the last 11 consecutive months! Did you catch that? MGF employment was shrinking before covid hit us. That's why some people think we were kind of slowing down or heading towards a mild recession before covid and then covid just took us there officially. That means manufacturing employment has shrunk every month for 11 months straight. Does that make sense? The ISM MFG Index was under 50 big time since Covid hit (March - Sept) (MFG output shrunk and did not expand enough to actually create jobs), so they got rid of lots of workers and that is why the ISM Employment Index continued to be under 50...until now!!!!!!! Red alert: ISM®’s Employment Index registered 53.2 percent in October, 3.6 percentage points higher than the September reading of 49.6 percent. “Following 14 consecutive months of contraction, the Employment Index moved back into expansion territory. In my opinion, if the ISM PMI continues to be above 50, and factories continue to create new jobs (which they did in October), then this is the beginning of a steep V shaped recovery. If the ISM PMI is only slightly above 50 or even under 50 moving forward, then it will be not be a V shaped recovery because not enough new factory jobs will be created. Remember, 1 factory job creates another 10-20 jobs for everywhere else. While only 10-15% of Americans work in manufacturing, the remaining 85-90% employed in the service sector are either directly or indirectly connected to those manufacturing jobs. So, people losing their jobs in MFG matters to everyone in the economy! Everyone needs the ISM MFG index to be above 50 every month, then the ISM employment index will eventually get above 50 every month (which it finally did in October, jobs are being created!) and then that will spill over into the service sector (which is where most Americans work). Does it make sense to you why MFG jobs are so important to the U.S. economy even though they only employ 10% of America's workforce? Each MFG job might create 5-20 jobs in the service sector indirectly. That factory in town might employ 1000 people with great paying jobs but those jobs create supplier jobs and service sector jobs. Those service sector jobs include: the pizza shop in town, the accountants in town, the lawyers in town, the nurses in town, the grocery stores in town, etc. During the 2006-2009 time period (your childhood, do you remember?), the ISM MFG and employment indices were below 50 for several years, for nearly 40 consecutive months. Long before America started its overall economic great recession in 2008, there was a manufacturing recession going on. Many economists believe the ISM MFG index is a precursor and leading economic indicator for what will happen in the overall economy. It certainly predicted the great recession of 2008 and is the reason, especially supply chain managers, need to follow this measure more closely. That is why people were freaking out over the ISM MFG Index being under 50. But, we bounced back over 50 in June and it has been above 50 since!!!

[@timdecuypere850]

Fantastic analysis, thanks again. How do you intepret a number which is above 50 but the growth is slowing? Is this a sign something might hit under 50 soon if the MFG is slightly above 50 or are these normal "cycles"? Thanks

[@simecurkovic]

Join: simecurkovic.com I just created a website and it gives you access to hundreds of my blogs, job postings, hours of lecture videos, and class/research material. Also, there is a Q & A and contact section. You can contact me for any purpose any time and I will get back to you quickly. The subscription is only $25 for an entire year. You are under no obligation to join, but I think the investment would pay for itself. Also, even if you do not join, you can of course still reach out any time. I would be grateful if you considered joining. Free sample view of one blog (see Elon’s resume and get resume ideas): www.simecurkovic.com/2021/04/30/does-your-resume-make-it-obvious-that-you-know-how-to-solve-problems/ Please join at: www.simecurkovic.com/membership/ Thank you again! Sime

[@simecurkovic]

During the 2006-2009 time period (your childhood, do you remember?), the ISM MFG and employment indices were below 50 for several years, for nearly 40 consecutive months. Long before America started its overall economic great recession in 2008, there was a manufacturing recession going on. Many economists believe the ISM MFG index is a precursor and leading economic indicator for what will happen in the overall economy. It certainly predicted the great recession of 2008 and is the reason, especially supply chain managers, need to follow this measure more closely. That is why people were freaking out over the ISM MFG Index being under 50 when covid hit. But, we bounced back over 50 in June and it has been above 50 since!!! While only 10-15% of Americans work in manufacturing, the remaining 85-90% employed in the service sector are either directly or indirectly connected to those manufacturing jobs. So, people losing their jobs in MFG matters to everyone in the economy! Everyone needs the ISM MFG index to be above 50 every month, then the ISM employment index will eventually get above 50 every month (which it has the last two months, jobs are being created!) and then that will spill over into the service sector (which is where most Americans work). Does it make sense to you why MFG jobs are so important to the U.S. economy even though they only employ 10% of America's workforce? Each MFG job might create 10-20 jobs in the service sector indirectly. That factory in town might employ 1000 people with great paying jobs but those jobs create supplier jobs and service sector jobs. Those service sector jobs include: the pizza shop in town, the accountants in town, the lawyers in town, the nurses in town, the grocery stores in town, etc.

[@timdecuypere850]

Great stuff - thank you. Would love to see more of your interpretation of the monthly reports.

[@simecurkovic]

The ISM MFG PMI Index was above 50 for the 4th consecutive month in August 2020! Great news. However, the ISM employment index was under 50 for the 13th consecutive month. BUT, the ISM employment index keeps getting closer and closer to being above 50. If the ISM MFG index keeps staying above 50, we are very close to creating new job growth in mfg which means lots of indirect jobs in the service sector being created. The economy is getting better (for now).

[@simecurkovic]

My contact information: Sample Lectures & Should You Major in Supply Chain Management? wmich.edu/supplychain/academics/lectures Dr. Sime (Sheema) Curkovic, Ph.D., Professor, Operations/Supply Chain Pat Daugherty Supply Chain & Lee Honors College Fellow Associate Director, Center for Integrated Supply Mgmt Western Michigan University, Haworth College of Business Schneider Hall Room 3246, Kalamazoo, MI 49008-5429 Tel.: [phone]; E-Mail: [e-mail] "Better, faster, cheaper"; www.wmich.edu/supplychain "WMU Integrated Supply Management (ISM)...Nation's best undergraduate SCM program (Gartner 2014); 2nd in SCM technology (SoftwareAdvice 2015); 2nd in top global SCM talent (SCM World 2017) Vitae: wmich.edu/supplychain/directory/curkovic

[@simecurkovic]

More good news: U.S. manufacturers grew a bit slower in January as the coronavirus caused more work disruptions, but companies are still expanding rapidly and anticipating a stronger economy in 2021. The Institute for Supply Management said its manufacturing index slipped to 58.7% in January from 60.5% in the prior month. December’s reading was the highest in almost 2½ years and was close to a 16-year peak. Economists surveyed by Dow Jones and The Wall Street Journal had forecast the ISM index to total 60%. Readings over 50% indicate growth, and anything over 55% is considered exceptional. Manufacturers have expanded steadily since the economy reopened last spring, benefiting from a shift in spending toward goods such as new cars or electronics and away from services like dining out or traveling. The better news: ISM®’s Employment Index registered 52.6 percent in January, 0.9 percentage point higher than the seasonally adjusted December reading of 51.7 percent. The Employment Index grew for the second month in a row. If mfg continues to expand, mfg will hire more people, when that happens, it creates even more jobs in the service sector (which is where most people work). Things are looking better!

[@simecurkovic]

Our students are going into a job market inundated with outdated processes. Manual and labor-intensive operations will force them to spend hours every week doing repetitive tasks that could be automated for much greater efficiency and accuracy, allowing them to focus on more fulfilling work. The majority of their time will be spent gathering data, while much less will be spent analyzing and providing insights to support strategic decision-making. For example, during these inflationary times, it is time for business faculty to start teaching the lost art of Price Analysis and Strategic Cost Management (in very different ways). I have asked a lot of business managers how they “prepare” to negotiate price increase requests from their suppliers. In particular, I was curious about how and where they get their data from (i.e., Chicago Board of Trade (CBOT), Chicago Mercantile Exchange (CME), Commodity Exchange (COMEX), London Metals Exchange (LME), New York Mercantile Exchange (NYMEX), etc.). Many said their suppliers provide that information. I am not convinced that using data from your suppliers is a form of “Preparation” for the negotiation process. Surprised by price increases? As much as 70% of current contracts have price increase provisions! In the WMU supply chain management program we teach our students to track commodity forward price curves. We now look at raw material market data from multiple sources, visualize and analyze historical pricing scenarios, and simulate planned purchases and what-if scenarios against forward price curves. How do we better prepare our business students to be job ready day one? Procurement organizations need processes and “tools” to mitigate and negotiate on these price increase requests in a strategic, data-driven manner (and academics need to do a better job of teaching it). Traditionally, we have worked very hard to help our students develop very sophisticated data analytics skill sets to manage these very large and complicated forms of information. Employers place a premium on these business analytics skill sets and would include: Advanced Excel (power query & pivot) & macros; 2. Data visualization (Tableau, Power BI & python w/ seaborn & matplotlib); 3. Data mining/RapidMiner, machine learning & data science; 4. Python & Jupyter notebook (data analytics & statistical libraries such as pandas, numpy); 5. Relational data models (Excel data model); 6. Graphic & statistical libraries (Seaborn, Matplotlib, Pandas, & Plotly). See our Business Analytics minor at: wmich.edu/infosystems/academics/analytics However, I would recommend complimenting the above skill sets with bringing in some cloud-based software and technology that gets us beyond manually updating and coding giant colored Excel spreadsheets. For example, I have been collaborating with N-Alpha and they have a cloud platform called materialx that I am bringing into the classroom (n-alpha.com/solutions/decision-support/). It gets us away from manually updating spreadsheets. Further, these technology software companies tend to be very supportive in helping faculty and students as these students will eventually become the future business professionals that actually use the technology (win-win-win, right?). And the technology is out there! We will soon have some white papers from our WMU SCM program based on the following price analysis & strategic cost management research. Some of our alumni are already testing and / or implementing these cloud-based services that allows procurement organizations, finance, and all other organizations that are exposed to raw material pricing changes, to stay on top of market pricing from multiple sources and proactively assess its impact on future raw material purchases. These technologies are also now serving as the basis for addressing price indexing implementations (formulas, alerts, etc.). It can all be done automatically and updated daily, saving hours from manually updating spreadsheets. These tools are quick and easy to use to prepare for price negotiations with suppliers, and often returns its investment (which is minimal to begin with) rapidly. These technologies also allow organizations to replace multiple spreadsheets and email threads with one tool that tracks pricing, facilitates collaborative decisions, revisiting past decisions and what led to them, and capturing organizational knowledge. I have asked many of my former students what are the most prevalent technologies used in your supply chain and business role. The two most common answers are Excel spreadsheets and email. It is 2023 now and we need to move further along. You could make a strong case that using antiquated business tools was a major source of supply chain disruptions the last few years. My former students keep telling me they are the “Excel Spreadsheet” generation. Excel works and they have very advanced spreadsheet skills. They also tell me that it gives them a competitive advantage in the workplace (i.e., people depend on their monthly report outs per se and very important people read them). The older managers have very weak Excel skills and even the younger graduates coming in have to play catch up to the people that are in their 30s and 40s (that have very advanced Excel skills). My former students also feel very comfortable with Excel. Many of these spreadsheets are their own creation and they find it empowering. In general, it works, it works well, it gets the job done, they feel comfortable with this version of technology while most others do not feel comfortable with it, the technology itself is cheap, and it gives them job security. Some said it took years to build up these spreadsheets, and now they are up and running. However, as I teach my current students, there are alternatives rooted in technology that will allow you to do things better, faster, and cheaper. Final Thought In talking with a colleague, we both agreed that many hiring managers do not have a full understanding of the Artificial Intelligence (AI) skill sets associated with our graduating students. Our business students told us many times that their hiring managers valued only the traditional Excel capabilities (i.e., lookup functions, pivot tables, etc. - however, that is NOT AI). Managers also greatly overlook the opportunities from other analytical solutions (skill sets that our students have). This makes it a bit difficult to sell the analytical techniques taught in classes that go beyond our Advances Excel and Predictive Analytics courses. For example, our data mining class is essentially a machine learning class for business, which is the core of AI. The course is designed to solve the problems that Excel falls short on. Hopefully we do a better job of training our students to “sell” the AI skills and managers become more open to embracing the benefits (which might require a culture change). Embracing and trying new technologies requires leadership that is willing to try new things. Otherwise, we keep using spreadsheets and email to manage very large and complicated data sets.

[@simecurkovic]

The ISM MFG PMI Index has contracted for the 19th time in the last 20 months. Yes, that is a MFG recession, but does this predict and/or is a precursor to an overall recession? Maybe. During the 2006-2009 time period, the ISM MFG and employment indices were below 50 for several years, for nearly 40 consecutive months. Long before America started its overall economic great recession in 2008, there was a mfg recession going on. Some economists believe the ISM MFG index might be a precursor and leading economic indicator for what will happen in the overall economy. Either way, supply chain managers need to follow this measure closely. IMPORTANT: Any number above 50 means mfg expanded from the previous month (they made more stuff). Any number under 50 means they made less stuff than the previous month. If the ISM PMI MFG Index is above 50 for the month, then that simply means American mfg output expanded compared to the previous month. That is good because if it keeps being above 50 every month that means we are cranking out more and more stuff and that means jobs will be created. Note, before the covid contraction in 2020 March, April, and May, the U.S. economy grew "131" consecutive months. Why does this ISM MFG index (the PMI) matter? Answer: If MFG keeps shrinking month to month, our overall economy might start to shrink (eventually that means recession). In my opinion, if the ISM PMI gets back to be above 50, then we will avoid a recession, especially a LABOR recession. Remember, 1 factory job might create another 10-20 jobs for everywhere else. While only around 10% of Americans work in mfg, the remaining 90% employed in the service sector are either directly or indirectly connected to those mfg jobs. So, people losing their jobs in MFG matters to everyone. Everyone needs the ISM MFG index to be above 50 every month, then the ISM employment index will eventually get above 50 every month and then that will hopefully spill over into the service sector (which is where most Americans work). That factory in town might employ 1000 people with great paying jobs but those jobs create supplier jobs and service sector jobs. Those service sector jobs include: the pizza shop in town, the accountants in town, the lawyers in town, the nurses in town, the grocery stores in town, etc. Here's to getting out of the mfg recession. Don't forget, America has around 300,000 factories that employ 13M people and we make close to 20% of the world's stuff. 37% of all domestic jobs in the U.S. are in the supply chain.

[@simecurkovic]

Side Note (I know repetitive): Today, for the first time in American history, most manufacturing jobs are not out on the shop floor but are instead in office cubicles. America has the most productive manufacturing workforce on the planet and can produce six times the product with the same amount of workers as it could 40 years ago. However, this productivity phenomenon should serve as a warning to all American workers that you have to be good at something that cannot be outsourced. Most of the jobs in manufacturing now require a college degree or trade skill. These jobs that require a college degree (production control, inventory management, procurement, etc.) or a trade skill (electrician, plumber, welder, machinist, etc.) command good salaries because they are not competing against non-Americans. I know it is easier said than done, but we need to work harder to develop these skills so that we will not be as adversely affected by globalization. The American manufacturing laborer is competing against non-Americans who will work for much lower wages (around $1-$5/hr in China and $4-$8/hr in Mexico). Free trade agreements (NAFTA, CAFTA, WTO, TPP, etc.) with developing countries have perpetuated this situation. There will be no end in sight because the global economy revolves around generating shareholder value. The ability of American companies to invest abroad has benefited very large portions of our workforce, but it has also left several behind. This brings me to the real problem at several of America’s more mature manufacturing companies whose hourly workers tend to still have strong union representation. You can blame what might be overpaid hourly workers, but mismanagement is at the heart of the problem on both the management and union side. For example, the stock prices of these manufacturing companies has slipped because of an inability to generate a positive and large return on investment. Yes, these companies make money (sometimes and often), but a firm’s net income as a percentage of total sales is small and the thin margins that accompany that turn investors away. The only way these companies can improve their return on investment is to widen margins and improve their asset turnover rate (ROI = Profit Margin * Asset Turnover Rate). One way to do this is to reduce direct labor costs. They could also increase sales, but that can prove difficult in the saturated and competitive U.S. market. These companies are competing against others with much lower direct labor costs. So, where do most of their costs come from? Most come from direct material purchases (over 50%) and overhead. Another way to improve return on investment is to optimize supply chain performance because that would help widen margins by reducing costs and increasing asset turnover rate. Management and union leadership have let their shareholders down more so than their hourly workers. Management needs to more effectively reduce their firms’ direct material and overhead costs while better managing supply chain assets such as inventory. They should work with their hourly workforce to implement lean manufacturing techniques that are proven methods for reducing costs and improving performance. The unions should also bend over backwards with open arms to help management implement these techniques. Fortunately, all of this is happening and will hopefully contribute to more positive news as is being reflected in the ISM manufacturing and employment indices. Bottom line, ISMers will be fine either way. Major in something where demand exceeds supply and do something where you are not competing against Mexican and Chinese workers that will work for less than $5 per hour. I am guessing that someone who works for less than $5 per hour cannot read CAD drawings, negotiate a contract, perform data analytics, use SAP/ERP, etc. ******************************************** The October Manufacturing PMI® registered 59.3 percent, up 3.9 percentage points from the September reading of 55.4 percent and the highest since September 2018 (59.3 percent). ISM®’s Employment Index registered 53.2 percent in October, 3.6 percentage points higher than the September reading of 49.6 percent. What is the good news in the above statement? Do you understand why these two indices will be the two most significant determinants of the job market for ISM grads in 2021 and 2022?

[@simecurkovic]

The ISM MFG PMI Index was above 50 for the 5th consecutive month in September 2020! Great news. The ISM employment index was just under 50 (49.6) for the 14th consecutive month. BUT, the ISM employment index keeps getting closer and closer to being above 50. If the ISM MFG index keeps staying above 50, we are very close to creating new job growth in mfg which means lots of indirect jobs in the service sector being created. We are very close to mfg jobs being added and created. The economy is getting better (for now).

[@simecurkovic]

November ISM PMI above 50 again! Economic activity in the manufacturing sector grew in November, with the overall economy notching a seventh consecutive month of growth. The November Manufacturing PMI® registered 57.5 percent. This figure indicates expansion in the overall economy for the seventh month in a row after a contraction in April, which ended a period of 131 consecutive months of growth. However, the Employment Index returned to contraction territory at 48.4 percent, 4.8 percentage points down from the October reading of 53.2 percent. So, the MFG expansion is not expansive enough to actually create more new MFG jobs (which means fewer multiplier effects for service sector jobs). Job creation overall will sputter it appears for now. For my fellow Michiganders, auto mfg expanded but shrunk slightly on the employment side it appears. Absenteeism, short-term shutdowns to sanitize facilities and difficulties in returning and hiring workers are causing strains that will likely limit future manufacturing growth potential. I am ready for a vaccine.

[@simecurkovic]

Economic activity in the manufacturing sector grew in October, with the overall economy notching a sixth consecutive month of growth, say the nation’s supply executives in the latest Manufacturing ISM® Report On Business®. “The October Manufacturing PMI® registered 59.3 percent, up 3.9 percentage points from the September reading of 55.4 percent and the highest since September 2018 (59.3 percent). This figure indicates expansion in the overall economy for the sixth month in a row after a contraction in April, which ended a period of 131 consecutive months of growth. ISM®’s Employment Index registered 53.2 percent in October, 3.6 percentage points higher than the September reading of 49.6 percent. “Following 14 consecutive months of contraction, the Employment Index moved back into expansion territory. In my opinion, if the ISM PMI continues to be above 50, and factories continue to create new jobs (which they did in October), then this is the beginning of a steep V shaped recovery. If the ISM PMI is only slightly above 50 or even under 50 moving forward, then it will be not be a V shaped recovery because not enough new factory jobs will be created. Remember, 1 factory job creates another 10-20 jobs for everywhere else.

[@simecurkovic]

I had a student ask: Shouldn’t I major in Finance or Accounting if I want to become a CEO? I said: Well, being able to talk CFO talk is critical to long term success, but you might want to give this supply chain thing some thought…CEOs Will Come from an Unlikely Place: The Supply Chain... "...it’s clear that supply chain professionals are poised to become the most powerful executives in the world..." Note, this article (2018) was written before covid. Multiply the above statement by a factor of at least two. lnkd.in/g2rhdEAH Great read from Zero100: Supply Chain Leader Traits That Make for a Great CEO. Executive Summary: For many years marketing and finance were the logical breeding grounds for the CEO role, but this is changing with the rise of ubiquitous digital technology and a heightened awareness of environmental impacts, especially climate change. lnkd.in/gRK3Gauh More reads to back up the assertion that future CEOs will have SCM backgrounds... Why supply chain professionals make great CEOs: To become CEO, according to a recent Business Insider article, the move to an operational role is a common segue for many CFOs seeking the top spot. That’s not a coincidence: many companies seek out their CEOs from roles that are operational, such as supply chain management. A famous example, of course, is Tim Cook, CEO of Apple...lnkd.in/g6HJgvX3. Why supply chain professionals make great CEOs The metamorphosis of supply chain from a humble collection of support functions like purchasing, shipping and production to true business leadership is huge. Chief Supply Chain Officers (CSCOs) increasingly control 50% or more of a company’s annual spending, with two thirds of all employees directly reporting to the role. More importantly, CSCOs have begun to play a vital role in strategy development, product and service innovation, and even sales. Why the change? lnkd.in/gXqaMWU4 _ Supply Chain Leaders Making The Move To CEO Better supply chain management means better businesses, and better businesses make for a better world. Very few people make it to the top office of any business without first holding other major responsibilities. The chief financial officer (CFO) role is typically regarded as just such a standard precursor. However, according to a 2015 survey of CEOs in the Forbes 2000, only 13% of CEOs came over from the CFO position. Instead, the trend in recent years has been to move those CFOs into more operational roles, giving them an opportunity to bolster their hands-on abilities within the organization. lnkd.in/gp42y_Q9 How a Background in Supply Chain Can Set You on the Path to CEO Anyone who’s been paying attention knows that Supply Chain Management has emerged from its status a back-office function to become a major strategic differentiator for business. Welcome the Supply Chain CEO! lnkd.in/gxeu2a5B #supplychain #ceo #csuite #advancement

[@simecurkovic]

Subject: Explanation on the ISM PMI mfg. index (supply chain managers - your future boss will read stuff like this and it is all over the news) Students: Note: make sure you understand how to interpret the ISM MFG index (also called the PMI - Purchasing Managers’ Index). For example, if it is above 50, what does that mean? If it is below 50, what does that mean? Also below, what is the Total Cost of Ownership and how is that different than piece price? Pay attention to the section that reads: The June PMI® registered 52.6 percent, up 9.5 percentage points from the May reading of 43.1 percent. This figure indicates expansion in the overall economy for the second straight month after April’s contraction, which ended a period of 131 consecutive months of growth. Did you catch that above? Pre-covid, the U.S. economy grew 131 months in a row! Note, pre-great recession, in 2008, the U.S. economy grew every month 1991-2007 (for the most part). The U.S. is a job creation machine! If the ISM PMI MFG Index is above 50 for the month, then that simply means American mfg output expanded compared to the previous month. That is good because if it keeps being above 50 every month that means we are cranking out more and more stuff and that means jobs will be created. So, covid hit us. What happened? In March, April, and May, the PMI was under 50. Big surprise, right? But, for June, the PMI was above 50! If that number stays above 50 moving forward each month, that might mean the worst is behind us. Why does this matter to the government and us? Answer: If MFG keeps shrinking month to month, our overall economy will start to shrink (eventually that means recession). You do not want to be graduating during a recession (though you will still be fine). Note, before manufacturing started shrinking 4 months ago (PMI under 50), the PMI was above 50 for the better part of 3 years (MFG was increasing). OK, let's rehash this a bit... Each month the Institute of Supply Management calculates this thing called the ISM Mfg. Index (also called PMI). If an employer asked you what this meant or what the number meant, could you answer that interview question? The U.S. government takes this calculation very seriously, but almost no one knows what it is. I was asked to explain it to the local community back in May of 2012. Make sure you know how to interpret this number and what the current data says about our economy.

[@simecurkovic]

Students: Great news! The ISM MFG Index (or PMI) for July just came out and it was above 50 for the second straight month. That means American mfg output expanded for the second straight month. A few more months in a row of this and we should be back to normal (hopefully). This will matter greatly for the timing of your graduation and the job market. Thank you. Sime PMI® at 54.2%; July 2020 Manufacturing ISM® Report On Business® www.prnewswire.com/news-releases/pmi-at-54-2-july-2020-manufacturing-ism-report-on-business-301104442.html TEMPE, Ariz., Aug. 3, 2020 /PRNewswire/ -- Economic activity in the manufacturing sector grew in July, with the overall economy notching a third consecutive month of growth, say the nation's supply executives in the latest Manufacturing ISM® Report On Business®. The report was issued today by Timothy R. Fiore, CPSM, C.P.M., Chair of the Institute for Supply Management® (ISM®) Manufacturing Business Survey Committee: "The July PMI® registered 54.2 percent, up 1.6 percentage points from the June reading of 52.6 percent. This figure indicates expansion in the overall economy for the third month in a row after a contraction in April, which ended a period of 131 consecutive months of growth. The New Orders Index registered 61.5 percent, an increase of 5.1 percentage points from the June reading of 56.4 percent. The Production Index registered 62.1 percent, up 4.8 percentage points compared to the June reading of 57.3 percent. The Backlog of Orders Index registered 51.8 percent, an increase of 6.5 percentage points compared to the June reading of 45.3 percent. The Employment Index registered 44.3 percent, an increase of 2.2 percentage points from the June reading of 42.1 percent. The Supplier Deliveries Index registered 55.8 percent, down 1.1 percentage points from the June figure of 56.9 percent.

[@simecurkovic]

Updated explanation of ISM MFG PMI, March 2023: Explanation on the ISM PMI mfg. index (future supply chain managers - your future boss will read stuff like this and it is all over the news) Students: Note: make sure you understand how to interpret the ISM MFG index (also called the PMI - Purchasing Managers’ Index). For example, if it is above 50, what does that mean? If it is below 50, what does that mean? Hot off the presses, March 2023: (Tempe, Arizona) - Economic activity in the manufacturing sector contracted (shrunk) in March for the fifth consecutive month following a 28-month period of growth, say the nation's supply executives in the latest Manufacturing ISM® Report On Business®. “The March Manufacturing PMI registered 46.3%. IMPORTANT: Any number above 50 means mfg expanded from the previous month (they made more stuff). Any number under 50 means they made less stuff than the previous month. It has been under 50 for 5 months in a row (not good). UP UNTIL 5 MONTHS AGO - This figure indicated expansion in the overall economy for 29 months in a row after contraction in 2020 - March, April, and May (covid). Covid shrunk the U.S. economy for only 3 months! Why did Washington pump $6T of stimulus into the economy? Note, before the covid contraction in 2020 March, April, and May, the U.S. economy grew "131" consecutive months!!! Did you catch that above? Pre-covid, the U.S. economy grew 131 months in a row! Note, pre-great recession, in 2008, the U.S. economy grew every month 1991-2007 (for the most part). The U.S. is a job creation machine! In fact, all indications are that the U.S. might be the only economy that was poised for a growth surge in 2021 through 2022 (with the exception of China). How do we keep doing it?! SCM? Note, the U.S. economy grew almost 10% in 2021, astronomical growth (too much). If the ISM PMI MFG Index is above 50 for the month, then that simply means American mfg output expanded compared to the previous month. That is good because if it keeps being above 50 every month that means we are cranking out more and more stuff and that means jobs will be created. So, covid hit us. What happened? In March, April, and May 2020, the PMI was under 50 (and it has been again the last 5 months). But, for June 2020, the PMI was above 50! If that number stays above 50 moving forward each month, that might mean the worst is behind us. Well, it has been above 50 since June 2020 (until the last 5 months). The Federal Reserve Board has been raising interest rates to slow down the economy to combat inflation, and it looks like it might actually be working. Why does this ISM MFG index (the PMI) matter to the government and us? Answer: If MFG keeps shrinking month to month, our overall economy will start to shrink (eventually that means recession). You do not want to be graduating during a recession (though you will still be fine). Note, before manufacturing started shrinking 3 years ago during the covid shutdown (PMI under 50), the PMI was above 50 for the better part of 3 years (MFG was increasing). OK, let's rehash this a bit... Each month the Institute of Supply Management calculates this thing called the ISM Mfg. Index (also called PMI). If an employer asked you what this meant or what the number meant, could you answer that interview question? The U.S. government takes this calculation very seriously, but almost no one knows what it is. I was asked to explain it to the local community back in May of 2012. Make sure you know how to interpret this number and what the current data says about our economy. www.mlive.com/opinion/kalamazoo/2012/08/manufacturing_expanding_curkov.html ___ So where are we at now? Rehash... (Tempe, Arizona) - Economic activity in the manufacturing sector contracted (shrunk) in March for the fifth consecutive month following a 28-month period of growth, say the nation's supply executives in the latest Manufacturing ISM® Report On Business®. “The March Manufacturing PMI registered 46.3%. Remember- The ISM PMI Mfg Index has been above 50 for 29 straight months...until the last 5 months. That means they were cranking out more stuff, so what does that mean? Answer: they are hiring more people. You need more people eventually if you keep growing. Jobs! FYI: U.S. unemployment is 3.7% (near historic lows). Unemployment for people with college degrees is 1.9%. However, with mfg now cranking out less stuff we should see mfg creating fewer jobs. Well, unemployment is still at 3.7%. BUT, the number of unfilled open jobs in America has dropped from 11 million to 9.99 milliion. In my opinion, if the ISM PMI gets back to be above 50, then we will avoid a recession, especially a LABOR recession. Remember, 1 factory job creates another 10-20 jobs for everywhere else. While only 10% of Americans work in manufacturing, the remaining 90% employed in the service sector are either directly or indirectly connected to those manufacturing jobs. So, people losing their jobs in MFG matters to everyone in the economy! Everyone needs the ISM MFG index to be above 50 every month, then the ISM employment index will eventually get above 50 every month (that has also been under 50 the last two months) and then that will spill over into the service sector (which is where most Americans work). Does it make sense to you why MFG jobs are so important to the U.S. economy even though they only employ 10% of America's workforce? Each MFG job might create 10-20 jobs in the service sector indirectly. That factory in town might employ 1000 people with great paying jobs but those jobs create supplier jobs and service sector jobs. Those service sector jobs include: the pizza shop in town, the accountants in town, the lawyers in town, the nurses in town, the grocery stores in town, etc. During the 2006-2009 time period (your childhood, do you remember?), the ISM MFG and employment indices were below 50 for several years, for nearly 40 consecutive months. Long before America started its overall economic great recession in 2008, there was a manufacturing recession going on. Many economists believe the ISM MFG index is a precursor and leading economic indicator for what will happen in the overall economy. It certainly predicted the great recession of 2008 and is the reason, especially supply chain managers, need to follow this measure more closely. That is why people were freaking out over the ISM MFG Index being under 50 when covid hit. But, we bounced back over 50 in June 2020 and I hope we do again after this 5 month skid. Please watch... kzbin.info/www/bejne/Y3yok5poe7mUqpY Do you understand why the ISM MFG and Employment Indices will be the two most significant determinants of the job market for ISM/SCM grads in 2023 and 2024? In general, companies do not hire college grads during recessions. In general, America has seen 2 short recessions during the last 20 years. 37% of all domestic jobs in the U.S. are in the supply chain. America has 9.99 million jobs unfilled. You will be just fine in the job market upon graduation either way, but especially if the ISM MFG PMI gets back above 50. __ FYI: Chinese workers make your iPhone for $4/hour and that is considered a great paying factory job. "New workers will be offered a salary of 30 yuan ($4.16) per hour…would offer staff who had left in recent weeks a one-off bonus of 500 yuan ($69.28) should they return." Does Apple or Google make phones in the USA? Nope. Personally, I wish there were more good paying jobs for less skilled workers in the U.S., but that’s not the world we live in anymore. www.linkedin.com/posts/sime-curkovic-61617a115_worlds-largest-iphone-factory-needs-100k-activity-6999429221303418880-siSS? Thank you. Sime

[@simecurkovic]

Research: In Supplier Negotiations, Lying Is Contagious. Summary- Being deceptive - or not totally honest - in negotiations is fairly common. But two experiments found that it can have a harmful effect: It can spread in an organization. This article discusses the research findings and offers measures that can curb the practice of potentially contagious excessive deception. lnkd.in/gJvYDNdT. __ ISM identifies negotiation as the most important skill of SCM profs & yet the weakest in terms of delivery. However, not at WMU. In fact, our Supply Chain majors take the class with Sales majors. lnkd.in/guTUcvdu. Of 8 countries examined, workers in the U.S. are the most anxious negotiators. My theory: lack of formal training & we throw them into these roles too soon. It never hurts to think like a lawyer. That is why we make our SCM students take a customized legal course. lnkd.in/g9W9sjUc The Bad Actors of OEM Procurement. "When sending out a request for quote (RFQ), OEMs have the option of soliciting bids either on individual parts or parts packages as a whole. This latter practice is often referred to as bundling, & its purpose is to incentivize suppliers to quote in the most competitive manner since they can sense a significant amount of business is at stake. This practice, in itself, is not procurement malpractice." For rest of read: lnkd.in/gy7DBU6U As a buyer, you have every legal right to say you want a “cost breakdown” of the price they gave you. Let’s say you have a supplier and you are starting to get the vibe that you are overpaying. What can you do? You could ask them for a cost break down. lnkd.in/gC2THQWB Reads… How should orgs use competitive bidding? lnkd.in/gS9vCRQ6 Assume a supplier estimates the following costs on an RFQ lnkd.in/gxFBz3_U ROI & Your Core Competency (i.e., SCM?) lnkd.in/euh2rFdU To stay competitive, companies are forced to outsource commodities & focus on core competency lnkd.in/g-DHtt8X The primary elements for sourcing a partner lnkd.in/ga2xtDsi What does it mean to be hollow? Sourcing Strategy matters! lnkd.in/gHB-nzeJ The most reprinted article in HBR: The “Core Competence” lnkd.in/gDsHme-r You have every legal right to say you want a “cost breakdown” lnkd.in/gygd5bzs Procurement 101: Explanation on Commodities lnkd.in/g_nEgvhJ How do companies outsource strategically? lnkd.in/gevbRKEq Adv Contract Mgmt: lnkd.in/gcpHEEvw How SCM managers “prepare” to negotiate price increases. lnkd.in/gVrdpuer Supplier Cost Breakdowns & How To Negotiate Price Increases: lnkd.in/gp5naJxE lnkd.in/gGRaKtVK lnkd.in/gMuhMNf6 lnkd.in/gQZ7HfWb lnkd.in/gvCpr6T5 lnkd.in/gPVMbWd6 lnkd.in/g6qdMvcS lnkd.in/gwFjDfx7 lnkd.in/g494sxYr lnkd.in/g6Uxkuby #supplychain #negotiation #procurement

[@simecurkovic]

Notice below: "...increased use of total cost of ownership for sourcing decisions." Do you understand what they mean? For the first time in decades (pre covid), more manufacturing jobs are returning to the U.S. than are going offshore, according to a report by the Reshoring Initiative. The combined reshoring and foreign direct investment (FDI) trends grew by over 10 % in 2016, adding 77,000 jobs (tying the 2014 record) and exceeding the rate of offshoring by about 27,000 jobs. The 2016 results bring the total number of manufacturing jobs brought back from offshore to more than 338,000 since the manufacturing employment low of February 2010. The rate of job return announcements doubled in November 2016 and hit an all-time peak monthly record in January 2017. In comparison to 2000-2003, when the U.S. lost, net, about 220,000 manufacturing jobs per year to offshoring, 2016 achieved a net gain of 27,000. The tide has turned, the group said with the numbers demonstrate that reshoring and FDI are important contributing factors to the country’s rebounding manufacturing sector. Some of the factors that caused the increase is the anticipation of potential policy changes that will make the U.S. more competitive, continued rising wages overseas, and increased use of total cost of ownership for sourcing decisions. "We publish this data annually to show companies that their peers are successfully reshoring and that they should reevaluate their sourcing and siting decisions,” said Harry Moser, president of the Reshoring Initiative. The group points out, however, that there are “still huge opportunities and challenges to bringing back all the 3 to 4 million manufacturing jobs cumulatively lost to offshoring.” To address this Moser said that he wants the "administration and Congress to enact policy changes to make the U.S. competitive again." Moser offers ups his group's Competitiveness Toolkit which will help is quantify the impact of policy alternatives, including: stronger skilled workforce; lower corporate taxes and regulations; and lower U.S. dollar. The reports looked into a variety of issues affecting reshoring. Here are some highlights: • Proximity to customers was the leading factor in 2016, followed by government incentives, skilled workforce availability and ecosystem synergies. • The Southeast and Texas remain the top regions for reshoring and FDI, with the Midwest in second place due to its strong industrial base. • Transportation equipment remained the strongest industry, accounting for nearly 40% of total jobs returned. • Plastics/rubber and furniture saw the largest increases in industry ranking. • FDI has remained stronger than reshoring. Both trends are based on the logic of producing in the local market, otherwise known as localization.

[@simecurkovic]

Great news for Dec 2020...Economic activity in the manufacturing sector grew in December, with the overall economy notching an eighth consecutive month of growth. “The December Manufacturing PMI® registered 60.7 percent, up 3.2 percentage points from the November reading of 57.5 percent. This figure indicates expansion in the overall economy for the eighth month in a row after contracting in March, April, and May, which ended a period of 131 consecutive months of growth. ISM®’s Employment Index registered 51.5 percent in December, 3.1 percentage points higher than the November reading of 48.4 percent. “Following one month of contraction, the Employment Index moved back into expansion territory. For the fourth straight month, survey panelists’ comments indicate that significantly more companies are hiring or attempting to hire than those reducing labor forces,” says Fiore. An Employment Index above 50.8 percent, over time, is generally consistent with an increase in the Bureau of Labor Statistics (BLS) data on manufacturing employment. In my opinion, if the ISM PMI continues to be above 50, and factories continue to create new jobs (which they did in December), then this is the beginning of a steep V shaped recovery. If the ISM PMI is only slightly above 50 or even under 50 moving forward (such as being under 50 in November), then it will be not be a V shaped recovery because not enough new factory jobs will be created. Remember, 1 factory job creates another 10-20 jobs for everywhere else.

[@simecurkovic]

For more information: www.simecurkovic.com/2021/09/04/the-august-2021-manufacturing-pmi-registered-59-9-that-means-american-mfg-cranked-out-more-stuff-than-the-previous-month/ www.simecurkovic.com/2021/04/29/where-did-the-middle-class-go-is-it-scms-fault/

[@simecurkovic]

“The February Manufacturing PMI® registered 60.8 percent, an increase of 2.1 percentage points from the January reading of 58.7 percent. This figure indicates expansion in the overall economy for the ninth month in a row after contraction in March, April, and May. This equals the highest reading since February 2018 (60.8 percent); prior to that, the PMI® registered 61.4 percent in May 2004. ISM®’s Employment Index registered 54.4 percent in February, 1.8 percentage points higher than the January reading of 52.6 percent. “The Employment Index grew for the third month in a row!" If mfg continues to expand, mfg will hire more people, when that happens, it creates even more jobs in the service sector (which is where most people work). Things are looking better! Remember, 1 factory job creates another 10-20 jobs for everywhere else.

[@simecurkovic]

Subject: Explanation on the ISM PMI mfg. index (supply chain managers - your future boss will read stuff like this and it is all over the news) Students: Note: make sure you understand how to interpret the ISM MFG index (also called the PMI - Purchasing Managers’ Index). For example, if it is above 50, what does that mean? If it is below 50, what does that mean? Pay attention to the section that reads: (Tempe, Arizona) - Economic activity in the manufacturing sector grew in October, with the overall economy notching a sixth consecutive month of growth, say the nation’s supply executives in the latest Manufacturing ISM® Report On Business®. “The October Manufacturing PMI® registered 59.3 percent, up 3.9 percentage points from the September reading of 55.4 percent and the highest since September 2018 (59.3 percent). This figure indicates expansion in the overall economy for the sixth month in a row after a contraction in April, which ended a period of 131 consecutive months of growth. Did you catch that above? Pre-covid, the U.S. economy grew 131 months in a row! Note, pre-great recession, in 2008, the U.S. economy grew every month 1991-2007 (for the most part). The U.S. is a job creation machine! If the ISM PMI MFG Index is above 50 for the month, then that simply means American mfg output expanded compared to the previous month. That is good because if it keeps being above 50 every month that means we are cranking out more and more stuff and that means jobs will be created. So, covid hit us. What happened? In March, April, and May, the PMI was under 50. Big surprise, right? But, for June - October, the PMI was above 50! If that number stays above 50 moving forward each month, that might mean the worst is behind us. Why does this matter to the government and us? Answer: If MFG keeps shrinking month to month, our overall economy will start to shrink (eventually that means recession). You do not want to be graduating during a recession (though you will still be fine). Note, before manufacturing started shrinking 4 months ago (PMI under 50), the PMI was above 50 for the better part of 3 years (MFG was increasing). OK, let's rehash this a bit... Each month the Institute of Supply Management calculates this thing called the ISM Mfg. Index (also called PMI). If an employer asked you what this meant or what the number meant, could you answer that interview question? The U.S. government takes this calculation very seriously, but almost no one knows what it is. I was asked to explain it to the local community back in May of 2012. Make sure you know how to interpret this number and what the current data says about our economy. ********************************************************************************* www.mlive.com/opinion/kalamazoo/index.ssf/2012/08/manufacturing_expanding_curkov.html Students: Note - this was written in 2012 by me. The Institute of Supply Management compiles monthly data from supply chain executives to determine if manufacturing output is expanding or contracting in the U.S. An ISM mfg. index of above 50 percent indicates that the manufacturing economy is generally expanding; below 50 percent indicates that it is generally declining. Here is the great news for America and manufacturing driven economies such as Michigan - economic activity in the manufacturing sector expanded in April (2012). The index registered 54.8 percent, an increase of 1.4 percentage points from March's reading of 53.4 percent, indicating expansion in the manufacturing sector for the 33rd consecutive month! Why does this matter? Well, if manufacturing keeps expanding, then at some point companies have to hire more people, and that is exactly what is starting to happen. ISM's employment index registered 57.3 percent in April, which is 1.2 percentage points higher than the 56.1 percent reported in March. This is the 31st consecutive month of growth in the employment index! Keep in mind that around six years ago (2006) the ISM mfg. and employment indices were below 50 for several years. Long before America started its overall economic recession (the Great Recession), there was a manufacturing recession going on (hmmmm, mfg decline causes recessions?). Over four million manufacturing jobs have been lost in the last decade (2000-2010) and over 10% of those were in the state of Michigan alone. It is going to take several more years of manufacturing expansion to get those jobs back and it is indeed possible (2012-2019 we got most of those jobs back). If gas prices drop to two dollars a gallon and U.S. vehicle sales jump to 18 million units annually (from the current 13 million and as low as 9 million 3 years ago), then a lot of our problems would go away. And even though this has happened before (1990s), we should not hold our breath. Students - Read the previous two sentences - that is exactly what happened since 2012 (pre covid - cars and trucks were selling and gas was cheap and Michigan was doing great). Students: Note, I wrote the above in 2012. What has happened since then? Well, gas is still only $2.00 a gallon and North American car and truck sales are around 17 million units (it appears people are still buying cars and trucks). Michigan has created over half the manufacturing jobs lost during the 2000-2010 time period. NO ONE would have guessed that. Also, the auto industry is hiring close to one third of our ISM graduates. Of course, bailing out GM and Chrysler with over $50 billion of tax payer money helped. Note, most of that was paid back. Also, the President of WMU coordinated all of that when he worked for President Obama. Back to my 2012 article... Today, for the first time in American history, most manufacturing jobs are not out on the shop floor (they are in the cubicles). Today, America has the most productive manufacturing workforce on the planet and can produce six times the product with the same amount of workers as it could 40 years ago. However, let this productivity phenomenon be a warning to all American workers that you have to be good at something that cannot be outsourced. Most of the jobs in manufacturing now require a college degree or trade skill. These jobs that require a college degree (production control, inventory management, procurement, etc.) or a trade skill (electrician, plumber, welder, machinist, etc.) command good salaries because they are not competing against non-Americans. I know it is easier said than done, but we need to work harder to develop these skills so that we will not be as adversely affected by globalization. My dad warned me 30 years ago that his factory job would not be around for me. He was right and we need to warn others because politicians will not fight the power -- they are the power. Large and influential segments of our workforce benefit from globalization and they will make sure this trend does not reverse itself. However, there is a way we can all move forward and prosper, and it begins with training and education (take it seriously and fast). In the meantime, let's hope America’s working class gets educated and trained in order to protect their standard of living.

[@simecurkovic]

So where are we at now? October 2023... (Tempe, Arizona) - Economic activity in the manufacturing sector contracted (shrunk) in March for the 12th consecutive month following a 28-month period of growth, say the nation's supply executives in the latest Manufacturing ISM Report. Ugghh...this means America is in a manufacturing recession, which MIGHT mean the overall economy soon goes into a recession (maybe not though, assuming mfg picks up again soon - that means this MFG PMI number starts coming in at above 50). “The October Manufacturing PMI registered 46.7%. Remember- The ISM PMI Mfg Index has been above 50 for 29 straight months...until the last 12 months. That means they were cranking out more stuff, so what does that mean? Answer: they are hiring more people. You need more people eventually if you keep growing. Jobs! FYI: U.S. unemployment is 3.9% (near historic lows). Unemployment for people with college degrees is 1.9%. However, with mfg now cranking out less stuff we should see mfg creating fewer jobs. Well, unemployment is still at 3.9%. BUT, the number of unfilled open jobs in America has dropped from 11 million to 9.99 milliion. In my opinion, if the ISM PMI gets back to be above 50, then we will avoid a recession, especially a LABOR recession. Remember, 1 factory job creates another 10-20 jobs for everywhere else. While only 10% of Americans work in manufacturing, the remaining 90% employed in the service sector are either directly or indirectly connected to those manufacturing jobs. So, people losing their jobs in MFG matters to everyone in the economy! Everyone needs the ISM MFG index to be above 50 every month, then the ISM employment index will eventually get above 50 every month (that has also been under 50 the last two months) and then that will spill over into the service sector (which is where most Americans work). Does it make sense to you why MFG jobs are so important to the U.S. economy even though they only employ 10% of America's workforce? Each MFG job might create 10-20 jobs in the service sector indirectly. That factory in town might employ 1000 people with great paying jobs but those jobs create supplier jobs and service sector jobs. Those service sector jobs include: the pizza shop in town, the accountants in town, the lawyers in town, the nurses in town, the grocery stores in town, etc. During the 2006-2009 time period (your childhood, do you remember?), the ISM MFG and employment indices were below 50 for several years, for nearly 40 consecutive months. Long before America started its overall economic great recession in 2008, there was a manufacturing recession going on. Many economists believe the ISM MFG index is a precursor and leading economic indicator for what will happen in the overall economy. It certainly predicted the great recession of 2008 and is the reason, especially supply chain managers, need to follow this measure more closely. That is why people were freaking out over the ISM MFG Index being under 50 when covid hit. But, we bounced back over 50 in June 2020 and I hope we do again after this 12 month skid. Do you understand why the ISM MFG and Employment Indices will be the two most significant determinants of the job market for ISM/SCM grads in 2023 and 2024? In general, companies do not hire college grads during recessions. In general, America has seen 2 short recessions during the last 20 years. 37% of all domestic jobs in the U.S. are in the supply chain. America has 9.99 million jobs unfilled. You will be just fine in the job market upon graduation either way, but especially if the ISM MFG PMI gets back above 50.

[@simecurkovic]

May 2021: 12 months in a row! (Tempe, Arizona) - Economic activity in the manufacturing sector grew in May, with the overall economy notching a 12th consecutive month of growth, say the nation’s supply executives in the latest Manufacturing ISM® Report On Business®. This figure indicates expansion in the overall economy for the 12th month in a row after contraction in March, April, and May (2020 - covid). ISM®’s Employment Index registered 50.9 percent in May, 4.2 percentage points lower than the April reading of 55.1 percent. “The Employment Index grew for the sixth month in a row!!! Jobs, jobs, jobs. Did you catch that? The ISM PMI Mfg Index has been above 50 for 12 months now, that means they are cranking out more stuff, so what does that mean? Answer: they are finally hiring more people. You need more people eventually if you keep growing. Jobs! In my opinion, if the ISM PMI continues to be above 50, and factories continue to create new jobs (which they did in the last 3 months), then this is the beginning of a steep V shaped recovery. If the ISM PMI is only slightly above 50 or even under 50 moving forward, then it will be not be a V shaped recovery because not enough new factory jobs will be created. Remember, 1 factory job creates another 10-20 jobs for everywhere else. While only 10-15% of Americans work in manufacturing, the remaining 85-90% employed in the service sector are either directly or indirectly connected to those manufacturing jobs. So, people losing their jobs in MFG matters to everyone in the economy! Everyone needs the ISM MFG index to be above 50 every month, then the ISM employment index will eventually get above 50 every month (which it has the last three months, jobs are being created!) and then that will spill over into the service sector (which is where most Americans work). Does it make sense to you why MFG jobs are so important to the U.S. economy even though they only employ 10% of America's workforce? Each MFG job might create 10-20 jobs in the service sector indirectly. That factory in town might employ 1000 people with great paying jobs but those jobs create supplier jobs and service sector jobs. Those service sector jobs include: the pizza shop in town, the accountants in town, the lawyers in town, the nurses in town, the grocery stores in town, etc.

[@simecurkovic]

More salary data…CIPS Procurement Salary Guide 2022 reveals a 7.4% avg salary increase & the avg salary for all procurement & SCM pros in North America was $111,278. FYI, CIPS has tons of global salary data at: lnkd.in/gxbTMSyx. Salaries per "ASCM/APICS" $: 2022 lnkd.in/gtYC5Cnw vs 2021 lnkd.in/gpMvehY5 vs 2020 lnkd.in/gcsrX6tr. Salaries per "DC Velocity": 2021 lnkd.in/gESQFNZa vs 2020 lnkd.in/gW-U-KHK vs 2019 lnkd.in/gJquYyT4. From "ISM": 2018 $: lnkd.in/gV53aggX. 2020 $ (right before covid): lnkd.in/gz8WQEhr. 2021 $ (deep into covid): lnkd.in/g-SfG93A & lnkd.in/gn5jM9xt. People want more money & rewarding work (not paperwork). lnkd.in/g7BwX84c. "The demand for logistics talent has never been greater. The low unemployment rate has created a supply/demand imbalance, spurring employers to raise salaries in a bid to attract and retain top talent. Of the 454 respondents to DC Velocity’s 19th annual Salary Survey, 72%) saw a boost in their total compensation in the past year." Should college grads negotiate a higher starting salary? lnkd.in/gMJYNJkh. Salaries in SCM are going up & already average $10K-$20K higher than entry-level positions in other fields. lnkd.in/gCiYgwS2 There isn’t enough young people working in supply chain - lnkd.in/gtUcJpX7. SCM $ Information - lnkd.in/gn5jM9xt lnkd.in/gTBMP5dM lnkd.in/eQvfFMc lnkd.in/g7YamZCU Newer Supply Chain Salary Data. Avg salary $144,017 (2021: $131,771): lnkd.in/gESQFNZa - 2022 salaries are up across the board. On avg, supply chain pros are making $126,215/yr, an increase from $112,779 in 2021, but on par w/ 2020’s avg of $126,475. The median salary in 2022 is now $108K. 20% earn $150K - $249,999/yr, while 16% earn $120K -$149,999. 12% earn between $90K-$99,999, & 10% earn $100K-$119,999. At the higher end of the scale, 9% earn more than $250K/yr. For details, see: lnkd.in/gbumc4Wb Placement success of WMU SCM Program - *Median salary was $60K-65K (10% of grads hired on w/ 1 auto OEM at $78K!). lnkd.in/gV4x6GWE Recently had former students leave their jobs because of $...After thousands of students, I would say the #1 reason my students change jobs is...their boss. Money becomes a factor when they can make >20% elsewhere (#2 on list below). lnkd.in/gtPvk_mx FYI: WMU students can major in Leadership (however, they have to have another major also, make sense?). 10 Most Important Leadership Skills For The 21st Century Workplace (& How To Develop Them): lnkd.in/gmJ_GG6H lnkd.in/ghyTtVZM www.linkedin.com/posts/sime-curkovic-61617a115_74-avg-salary-increase-avg-salary-in-activity-7011781729321451520-gFt9? Sime (Sheema) Curkovic, Professor, Supply Chain Western Michigan University Sample Lectures: What is SCM? lnkd.in/e9j33EQ #salary #salaryguide2022 #salarynegotiation #supplychain

[@simecurkovic]

March 2021: We are in a V shaped recovery it appears. The 916,000 jobs gained in March exceeded economists’ predictions and nearly doubled the gains seen in February, bringing the unemployment rate down to 6%. However, the economy is still about 8.4 million jobs short of where it stood before states started shuttering nonessential businesses due to the pandemic last March. Remember, unemployment was under 4% pre-covid. Also,... The White House Council of Economic Advisers noted an additional 4 million workers have dropped out of the labor force entirely since February 2020. Accounting for those workers and various misclassification issues, they estimate the true unemployment rate would be closer to 9%. What do you think is going on with these 4 million workers that left the work force and are making no effort to join back in. Also, while you were on Spring Break the new ISM MFG Index (PMI) came out for March. Drum roll please...

[@simecurkovic]

Thank you Hire Lily for the supply chain salary data, & also your Insights: lnkd.in/gSYKjixY. Also from ISM: Both women’s & men’s compensation fell in 2021. From ISM: lnkd.in/g2dVpbeK & lnkd.in/gHMUSv_s. 2021 $ (deep into covid): lnkd.in/g-SfG93A & lnkd.in/gn5jM9xt. 2020 $ (before covid): lnkd.in/gz8WQEhr. 2018 $: lnkd.in/gV53aggX. Salaries per "ASCM/APICS" $: 2022 lnkd.in/gtYC5Cnw vs 2021 lnkd.in/gpMvehY5 vs 2020 lnkd.in/gcsrX6tr. FYI from 2019:lnkd.in/grttnhZm 2018: lnkd.in/gTBMP5dM Salaries per "DC Velocity": 2021 lnkd.in/gESQFNZa vs 2020 lnkd.in/gW-U-KHK vs 2019 lnkd.in/gJquYyT4. www.linkedin.com/posts/sime-curkovic-61617a115_more-supply-chain-salary-data-activity-7019631483912929280-eNkC?

[@simecurkovic]

Pre-covid, the U.S. economy grew 131 months in a row! Current streak = 17 months and Oct 2021 PMI = 60.8%! Note, > 10% of all jobs created lasted month were in SCM. Subject: Explanation on the ISM PMI mfg. index (future supply chain managers - your boss will read stuff like this & it is all over the news) lnkd.in/enaQSSRi Note: make sure you understand how to interpret the ISM MFG index (also called the PMI - Purchasing Managers’ Index). For example, if it is above 50, what does that mean? If it is below 50, what does that mean? Hot off the presses, Nov 2021: Economic activity in the mfg sector grew in Oct, with the overall economy notching a 17th consecutive month of growth, say the nation’s supply executives in the latest Manufacturing ISM® Report On Business®. This figure indicates expansion in the overall economy for the 17th month in a row after contraction in 2020 - March, April, and May (covid). Covid shrunk the U.S. economy for only 3 months! Note, before the contraction in 2020 March, April, & May, the U.S. economy grew "131" consecutive months!!! Did you catch that above? Pre-covid, the U.S. economy grew 131 months in a row! Note, pre-great recession, in 2008, the U.S. economy grew every month 1991-2007 (for the most part). The U.S. is a job creation machine! In fact, all indications are that the U.S. might be the only economy poised for a growth surge in 2021 through 2022. How do we keep doing it?! SCM? If the ISM PMI MFG Index is above 50 for the month, then that simply means American mfg output expanded compared to the previous month. That is good because if it keeps being above 50 every month that means we are cranking out more & more stuff & that means jobs will be created. So, covid hit us. What happened? In March, April, & May 2020, the PMI was under 50. Big surprise, right? But, for June - today, the PMI was above 50! If that number stays above 50 moving forward each month, that might mean the worst is behind us. Why does this matter to the gov & us? Answer: If MFG keeps shrinking month to month, our overall economy will start to shrink (eventually that means recession). You do not want to be graduating during a recession. Note, before mfg started shrinking 16 months ago during the covid shutdown (PMI under 50), the PMI was above 50 for the better part of 3 years (MFG was increasing). If an employer asked you what this meant or what the number meant, could you answer that interview question? The U.S. gov takes this calculation very seriously, but almost no one knows what it is. So where are we at now? ISM PMI Oct 2021 = 60.8%! More info on PMI & the covid job market... lnkd.in/euRd74NQ lnkd.in/ez4HYBWj Do you understand why the ISM MFG and Employment Indices will be the two most significant determinants of the job market for SCM grads and managers in 2021 and 2022?

[@simecurkovic]

www.logisticsmgmt.com/article/april_manufacturing_output_declines_for_sixth_straight_month_reports_ism?Newsletter&Email&oly_enc_id=3358G3995623A8W April manufacturing output declines for sixth straight month, reports ISM, By Jeff Berman May 1, 2023 April manufacturing output saw another month of contraction, according to the new edition of the Manufacturing Report on Business, which was released today by the Institute for Supply Management (ISM). The report’s key metric, the PMI, came at 47.1 (a reading of 50 or higher indicates growth), marking a slight 0.8% gain over March’s 46.3, while contracting, at a slower rate, for the sixth consecutive month. The past six months of contraction, through April, were preceded by a stretch of 29 consecutive months of growth. ISM also said that the overall economy contracted, at a slower rate, in April, for the sixth consecutive month, which was preceded by 30 consecutive months of growth. The April PMI is 3% below the 12-month average of 50.1, with May 2022 marking the high, for that period, at 56.1, and March 2023, the most recent reading, at 46.3, marking the lowest. ISM reported that five manufacturing sectors- Printing & Related Support Activities; Apparel, Leather & Allied Products; Petroleum & Coal Products; Fabricated Metal Products; and Transportation Equipment-saw growth in April. And 11 sectors saw declines, including: Furniture & Related Products; Wood Products; Nonmetallic Mineral Products; Electrical Equipment, Appliances & Components; Plastics & Rubber Products; Chemical Products; Machinery; Primary Metals; Computer & Electronic Products; Food, Beverage & Tobacco Products; and Miscellaneous Manufacturing. The report’s key metrics were mixed in April, including: New Orders, which are commonly referred to as the engine that drives manufacturing, increased 1.4%, to 45.7, contracting, at a slower rate, for the eighth consecutive month, with eight sectors reporting growth; Production increased 1.1%, to 48.9, contracting at a slower rate, for the fifth consecutive month, following 30 consecutive months of growth, but seeing its best reading since entering contraction last December, with 11 sectors reporting growth; Employment came in at 50.2, rising 3.3%, showing growth, after two months of contraction, with seven sectors reporting growth; Supplier Deliveries, at 44.6 (a reading above 50 indicates contraction), grew, at a faster rate, for the seventh consecutive month, with three sectors reporting slower deliveries in April, for its fastest supplier delivery performance since March 2009, when it was at 43.2; Backlog of orders, at 43.1, slipped 0.8%, contracting, at a faster rate, for the seventh consecutive month, following 27 months of expansion, with three sectors growing order backlogs; Inventories, at 46.3, were down 1.2%, contracting, at a faster rate, for the second straight month, following 19 consecutive months of growth Customer Inventories, at 51.3, increased 2.4%, moving from “too low” in March to “too high” in April, with seven sectors reporting customers’ inventories as too high; and Prices, at 53.2, rising 4.0%, increasing after contraction in March and growth in February, with nine sectors reporting higher prices paid for raw materials Comments submitted by the ISM member respondents again highlighted various themes related to the economy and market conditions. “Having invested heavily to de-risk the supply chain over the last three years due to COVID-19, we are looking to reset with a number of our suppliers to reduce inventory, which has grown steadily over that period,” said a Computer & Electronic Products respondent. “Lead times are generally coming down, although electronic components are still a concern.” Tim Fiore, Chair of the ISM's Manufacturing Business Survey Committee, said in an interview that even though the PMI did not move back into growth territory, there were some positive signs in the April report. One was the New Orders reading, which he explained it contracted at a lower level than in March, coupled with seasonal factors that would have pushed reading closer to 48. Another positive he cited was the New Export Orders reading up 2.2% to 49.8, coupled with Backlog of Orders, while contracting, remaining at the same level as March. “The most alarming problem here is that our customer inventory numbers now the probably the low end of too high, which kind of says on the inventory scale, or the greater supply chain scale, that the customers warehouses are full of stuff, so they don’t really have a need for anymore,” he said. “The only way to change that is by having more demand to the can ship more. That is offset by the fact that the manufacturing inventory number is down to its lowest level in many years, and that is really preparation for what they perceive to be a future drop in output.” The most positive part of the report, according to Fiore, is that the best measure of billings and revenue and production, with the April production number remaining pretty strong, up 1.1% to 48.9. “That is pretty good, and I cannot complain about that,” he said. “The accommodative piece here is really the input side, with suppliers delivering very fast, and manufacturing inventory is very low-so it would help to see that start to rebound at some point,” he said. “Our percentage [of manufacturing sectors] with PMI under 45 actually came down to 12% from 25% in March. I see that as a positive. Chemical products is still not recovering. It was very close to 45, which is a negative and was a negative in March. We are not seeing that chemical products demand growing. The manufacturing hire-to-fire ratio is still less than 2:1, which is a little bit better than March…and way off the 9:1 we saw a year ago. It is still a negative. Pricing on the transportation side and the ability to get transportation are still very accommodative and is a negative, too.”

[@simecurkovic]

No idea if these 6 rules of productivity actually came from Mr. Musk, but they make some good points. Note, I do not recommend #4 to my students: Don't use "chain of command" to communicate. That could really backfire. www.linkedin.com/posts/sime-curkovic-61617a115_elon-musks-six-rules-of-insane-productivity-activity-7001891116874702848-y6g4? ___ 1. Reduce the frequency of meetings According to Musk, "excessive meetings are the blight of big companies and almost always get worse over time." To make meetings more effective Musk suggests fewer of them unless there's an urgent matter to address. 2. Leave meetings that aren't valuable Similar to rule one, if an employee finds they cannot contribute successfully to a meeting then they should be allowed to leave with no repercussions. "It is not rude to leave, it is rude to make someone stay and waste their time," Musk says. 3. Don't use acronyms or nonsense words The best way to communicate effectively is to be direct about what you're saying, this means "don't use acronyms or nonsense words for objects, software, or processes." 4. Don't use "chain of command" to communicate "Communication should travel via the shortest path necessary to get the job done," Musk told employees. Musk finds it unnecessary for lower-level employees to communicate issues through the chain of command, rather than approaching a person directly. "Any manager who attempts to enforce chain of command communication will soon find themselves working elsewhere," he added. 5. Use common sense While it may seem obvious, some people need a reminder to use common sense in most situations. Musk used the example of following a "company rule" that would be "obviously ridiculous in a particular situation." 6. Avoid big meetings “Excessive meetings are the blight of big companies and almost always get worse over time. Please get [out] of all large meetings, unless you’re certain they are providing value to the whole audience, in which case keep them very short.” __ After a few thousand students, I would say this is the #1 reason my students change jobs (it's their boss). Money becomes a factor when they can make > 20% elsewhere (#2 on list below). FYI: WMU students can major in Leadership (however, they have to have another major also, make sense?). 10 Most Important Leadership Skills For The 21st Century Workplace (& How To Develop Them): lnkd.in/gmJ_GG6H "Quiet quitters" make up at least 50% of the U.S. workforce -- probably more, Gallup finds. U.S. employee engagement took another step backward during the 2nd quarter 2022, w/ the proportion of engaged workers remaining at 32% but the proportion of actively disengaged increasing to 18%. The ratio of engaged to actively disengaged employees is now 1.8 to 1. lnkd.in/gb4WBKvf www.linkedin.com/posts/sime-curkovic-61617a115_why-are-americans-quitting-their-jobs-5-activity-6997166854179876864-xHc-? #productivity #leadership #leadershipdevelopment simecurkovic.com

[@simecurkovic]

Yes, WMU supply chain grads from 2022 have a median wage range of $65-$75,000. Watch these major stories on WMU Haworth's major students. lnkd.in/dHhA8iEX Parents: 93% WMU graduates are employed or continuing education. lnkd.in/gPxaBnys FYI, from 2021, WMU salary report by every major: lnkd.in/gUueUNe7 WMU: No. 1 in Michigan for earnings by graduates from all backgrounds, Salaries & job placement by every major: lnkd.in/g3CZBrM7 Yes, the WMU Haworth College of Business is one of the best in the world. AACSB accredited (that means top 5% globally) & most programs are nationally/globally ranked. Why? My answer: faculty are obsessed w/ student success. Examples: WMU named in Princeton Review's 2022 'best business schools' lnkd.in/gnRvmJwD Accounting *Select 1% of business schools worldwide that have additional specialized AACSB accreditation for their accountancy programs. lnkd.in/esW6ZuD lnkd.in/eN5wF6b Supply Chain Management *Nation's best undergrad SCM program (Gartner); 2nd in SCM technology (SoftwareAdvice); 2nd in top global SCM talent (SCM World): lnkd.in/eprKKbF Food & Consumer Package Goods Mktg *Has earned certification for its category management coursework from the national Category Management Association lnkd.in/eTjBRP9 Sales & Business Mktg *Nationally ranked as the best university sales program since 2007 lnkd.in/etcppYi Digital Mktg & eCommerce *One of only a handful of its kind in the nation. wmich.edu/dme Advertising & Promotion *Among only 10 percent of advertising programs housed within a university business college, offering the best mix of marketing, communication & business fundamentals. lnkd.in/ecR2pxu Entrepreneurship lnkd.in/emeTCTJ *Starting Gate is a student business accelerator program that gives students rich and valuable resources to develop their startup companies. Human Resource Mgmt *One of a few programs in the state of Michigan recognized by the Society for Human Resource Management as having a curriculum consistent with their Body of Competency and Knowledge guidelines.lnkd.in/e75KnJ6 Leadership & Business Strategy *We undertake large scale consulting projects, executive mentorship for students, designing “learning spaces of the future" & supporting students in acquiring & operating small businesses. lnkd.in/e5JUSye Military Science & Leadership *Thank you for your service to our country! wmich.edu/rotc Finance & Commercial Law *Business law, finance & personal financial planning wmich.edu/finance Business Information Systems *Business analytics, Computer information systems, Cybersecurity lnkd.in/evSdSqU GRADUATE PROGRAMS *Princeton Review: one of the best places to earn a Master of Business Administration degree. #college #career #major #business

[@simecurkovic]

New trend/question when managers ask me about students: How professional is their email communication & attention to detail? Hmm. Hey College Students: Do not begin an email message with “Hey” & always finish it with “Thank you.” Most college students do the bulk of their electronic communication via text messaging. Standards for emailing are different, especially in academic settings. Students' emails WILL 100% influence the way their professors view them. On avg, professionals spend 28% of their workday just reading & writing emails, which amounts to an unbelievable 2.6 hours & 120 messages received every day (in SCM it’s probably way more). Will Email Stand The Test Of Time? lnkd.in/gz9NTye2 Do not underestimate the power of a professional email signature (most do not even have one, or they have very boring ones). It might be the first impression you create! lnkd.in/ge9nGrjx lnkd.in/evaNVnbv I just saw this one from a current student & liked it... lnkd.in/gqMRPeTC Do NOT round up your GPAs, use a post script on your phones for email replies, take your email signatures VERY seriously, & use keywords on your resume. Students should not change their official GPA for their resume. Instead, I recommend they calculate their major GPA using the courses required for their major & also list their overall GPA (especially if your major GPA is much higher than your overall & your overall is under a 3.0). Also, a 2.96 GPA is not a 3.00 GPA. If an employer requests an official transcript be sent upon graduation (which they will), this could be labeled as "falsification of employment record" & as a result, an offer of employment can be revoked (if you round up your GPA). I am noticing that several of my students are responding to my emails via smart phones. That is fine. It is 2022 & your future employer will expect you to do the same. However, it can be cumbersome to write emails on your phone that are clean & easy to read. & sometimes, you try to write one word but another word appears that was not intended. So, please take the time to make sure your reply message looks professional & reflects positively on you. Impressions will be made based on your written communication & you will be judged. I would also recommend programming your phone so that the post script tells the recipient of your message that it was sent from your smart phone. That way people will be less judgmental if a mistake was made. You can add the message in your iPhone settings so that it will appear on all emails sent by phone but not on your email signatures sent by computer. An appropriate post script message from your phone would be: “Note: this email was sent by iPhone, please forgive grammatical errors. “ Resume Keywords Ideas/Action Verbs. Does your resume use these? lnkd.in/ea6gV-K Here are my thoughts on resumes: lnkd.in/gxEy9VkH lnkd.in/gCgi72kX lnkd.in/gKV5JYhR #careeradvice

[@simecurkovic]

“Is the Chip Shortage Over? That Depends…reports seem to indicate that now there is actually too much supply.” Some serious bullwhip effect going on out there. What is the bullwhip effect? lnkd.in/gkwgZs7d. If you are bored...A great watch below on the Bullwhip Effect: lnkd.in/gqy8KFWv. Also, another good watch, but longer…This WSJ documentary offers a GREAT explanation on the supply chain. lnkd.in/giuVkH-c. Or, if you are really bored: Do I think students should negotiate an INTERNSHIP or FULL-TIME offer (i.e., a higher salary)? Yes, since some orgs are offering students 20-30% below market value (but only if you know how to negotiate). lnkd.in/gSzFhGvb There are already > 22,000 SCM 2023 internships posted & > 60,000 business related internships. lnkd.in/ge2JFUmk Yes, it is now time to start applying & interviewing for summer internships. Companies get budgets for internships approved months ahead of time & they often recruit nationally for the best talent. Some want to get this wrapped up by the end of the year, but you have to start looking now. lnkd.in/gZtrqGVZ FREE resources for Info on Suppliers, Customers, & Prospects. A former student working in B2B industrial sales, suggested the following list of free websites as a resource for research on competitors, customer supply chains, & prospect contact info. lnkd.in/g2yYPU8t Industry Certifications & Associations for Various Business Majors… Data shows that people earn more & have more job security if they become engaged members of their professional discipline. One way to do that is to join industry specific associations related to your majors. Further, these associations often have certifications with them that externally validate you as a subject matter expert ($$$). lnkd.in/gVbQV2q7 I have asked a lot of SCM managers how they “prepare” to negotiate price increase requests from their suppliers. In particular, I was curious about how and where they get their data from (i.e., CME, COMEX, etc.). Many said their suppliers provide that information. I am not convinced that using data from your suppliers is a form of “Preparation” for the negotiation process. lnkd.in/gxqx3srw #supplychain

[@simecurkovic]

www.mlive.com/opinion/kalamazoo/index.ssf/2012/08/manufacturing_expanding_curkov.html Students: Note - this was written in 2012 by me. The Institute of Supply Management compiles monthly data from supply chain executives to determine if manufacturing output is expanding or contracting in the U.S. An ISM mfg. index of above 50 percent indicates that the manufacturing economy is generally expanding; below 50 percent indicates that it is generally declining. Here is the great news for America and manufacturing driven economies such as Michigan - economic activity in the manufacturing sector expanded in April (2012). The index registered 54.8 percent, an increase of 1.4 percentage points from March's reading of 53.4 percent, indicating expansion in the manufacturing sector for the 33rd consecutive month! Why does this matter? Well, if manufacturing keeps expanding, then at some point companies have to hire more people, and that is exactly what is starting to happen. ISM's employment index registered 57.3 percent in April, which is 1.2 percentage points higher than the 56.1 percent reported in March. This is the 31st consecutive month of growth in the employment index! Keep in mind that around six years ago (2006) the ISM mfg. and employment indices were below 50 for several years. Long before America started its overall economic recession (the Great Recession), there was a manufacturing recession going on (hmmmm, mfg decline causes recessions?). Over four million manufacturing jobs have been lost in the last decade (2000-2010) and over 10% of those were in the state of Michigan alone. It is going to take several more years of manufacturing expansion to get those jobs back and it is indeed possible (2012-2019 we got most of those jobs back). If gas prices drop to two dollars a gallon and U.S. vehicle sales jump to 18 million units annually (from the current 13 million and as low as 9 million 3 years ago), then a lot of our problems would go away. And even though this has happened before (1990s), we should not hold our breath. Students - Read the previous two sentences - that is exactly what happened since 2012 (pre covid - cars and trucks were selling and gas was cheap and Michigan was doing great). Students: Note, I wrote the above in 2012. What has happened since then? Well, gas is still only $2.10 a gallon and North American car and truck sales are around 17 million units (it appears people are still buying cars and trucks). Michigan has created over half the manufacturing jobs lost during the 2000-2010 time period. NO ONE would have guessed that. Also, the auto industry is hiring close to one third of our ISM graduates. Of course, bailing out GM and Chrysler with over $50 billion of tax payer money helped. Note, most of that was paid back. Also, the President of WMU coordinated all of that when he worked for President Obama. Back to my 2012 article... Today, for the first time in American history, most manufacturing jobs are not out on the shop floor (they are in the cubicles). Today, America has the most productive manufacturing workforce on the planet and can produce six times the product with the same amount of workers as it could 40 years ago. However, let this productivity phenomenon be a warning to all American workers that you have to be good at something that cannot be outsourced. Most of the jobs in manufacturing now require a college degree or trade skill. These jobs that require a college degree (production control, inventory management, procurement, etc.) or a trade skill (electrician, plumber, welder, machinist, etc.) command good salaries because they are not competing against non-Americans. I know it is easier said than done, but we need to work harder to develop these skills so that we will not be as adversely affected by globalization. My dad warned me 30 years ago that his factory job would not be around for me. He was right and we need to warn others because politicians will not fight the power -- they are the power. Large and influential segments of our workforce benefit from globalization and they will make sure this trend does not reverse itself. However, there is a way we can all move forward and prosper, and it begins with training and education (take it seriously and fast). In the meantime, let's hope America’s working class gets educated and trained in order to protect their standard of living.

[@simecurkovic]

www.linkedin.com/posts/jason-miller-32110325_supplychain-supplychainmanagement-economics-activity-7155907121778229248-PpQA? Great post and read from Professor Miller: Data from the Federal Reserve Board concerning manufacturing output, coupled with ISM’s PMI data, suggests that manufacturing activity remained muted in December and is unlikely to see substantial improvements over the next few months. Two charts below illustrate this. Thoughts: •The top chart shows industrial production for manufacturing excluding pharma and computers & electronics [two sectors that sway macro-level statistics substantially yet don’t generate much freight]. December 2023’s seasonally adjusted data was effectively flat, suggesting that the ending of the UAW strike hasn’t resulted in a meaningful rebound in manufacturing output. Manufacturing output remains down ~2% from 2022’s highs (which themselves were about 3% below 2018’s highs). The best-case scenario at the moment is manufacturing output has bottomed out on a seasonally adjusted basis. Given the degree these data are correlated month-to-month in the levels, this suggests it will take several months for meaningful improvement to occur (and this assumes we are at the trough). •Bottom plot shows ISM’s new orders index, which is a diffusion index showing month-to-month momentum in new orders. We see that anytime new orders are near the neutral level (50) or negative, the Fed’s industrial production index falls. As can be seen, momentum for new orders is still in negative territory, albeit not as negative as 6-12 months ago. •Combined together, history suggests we need to see several months with the new orders PMI in the 55+ range before manufacturing output as measured by the FRB starts to increase (e.g., look at 2013-2014, 2017 - 2018). I’m not anticipating any shocks coming that will spur new orders the next few months. Implication: while I know logistics providers don’t want to hear this, we aren’t seeing any signs of manufacturing activity improving over the next few months. This suggests continually muted freight volumes. I urge everyone to disregard predictions of a market turnaround, especially in the truckload sector, in late Q1 or early Q2 2024.

[@simecurkovic]

Yes, WMU supply chain grads from 2022 have a median wage range of $65-$75K. Watch these "major" stories on WMU Haworth's students. lnkd.in/dHhA8iEX. Parents: 93% WMU graduates are employed or continuing education. lnkd.in/gPxaBnys. FYI, from 2021, WMU salary report by every major: lnkd.in/gUueUNe7. WMU: No. 1 in Michigan for earnings by graduates from all backgrounds, Salaries & job placement by every major: lnkd.in/g3CZBrM7 Yes, the WMU Haworth College of Business is one of the best in the world. AACSB accredited (that means top 5% globally) & most programs are nationally/globally ranked. Why? My answer: faculty are obsessed w/ student success. Examples: WMU named in Princeton Review's 2022 'best business schools' lnkd.in/gnRvmJwD Accounting *Select 1% of business schools worldwide that have additional specialized AACSB accreditation for their accountancy programs. lnkd.in/esW6ZuD lnkd.in/eN5wF6b Supply Chain Management *Nation's best undergrad SCM program (Gartner); 2nd in SCM technology (SoftwareAdvice); 2nd in top global SCM talent (SCM World): lnkd.in/eprKKbF Food & Consumer Package Goods Mktg *Has earned certification for its category management coursework from the national Category Management Association lnkd.in/eTjBRP9 Sales & Business Mktg *Nationally ranked as the best university sales program since 2007 lnkd.in/etcppYi Digital Mktg & eCommerce *One of only a handful of its kind in the nation. wmich.edu/dme Advertising & Promotion *Among only 10 percent of advertising programs housed within a university business college, offering the best mix of marketing, communication & business fundamentals. lnkd.in/ecR2pxu Entrepreneurship lnkd.in/emeTCTJ *Starting Gate is a student business accelerator program that gives students rich and valuable resources to develop their startup companies. Human Resource Mgmt *One of a few programs in the state of Michigan recognized by the Society for Human Resource Management as having a curriculum consistent with their Body of Competency and Knowledge guidelines.lnkd.in/e75KnJ6 Leadership & Business Strategy *We undertake large scale consulting projects, executive mentorship for students, designing “learning spaces of the future" & supporting students in acquiring & operating small businesses. lnkd.in/e5JUSye Military Science & Leadership *Thank you for your service to our country! wmich.edu/rotc Finance & Commercial Law *Business law, finance & personal financial planning wmich.edu/finance Business Information Systems *Business analytics, Computer information systems, Cybersecurity lnkd.in/evSdSqU GRADUATE PROGRAMS *Princeton Review: one of the best places to earn a Master of Business Administration degree. #college #career #major #business

[@simecurkovic]

Great post and more explanation: www.linkedin.com/posts/byron-gangnes_pmi-manufacturing-ugcPost-7236794176762175490-G1pe? Manufacturing sector still contracting according to ISM.® The Institute for Supply Management's ® Purchasing Managers Index (PMI®) contracted in August, marking the fifth straight month that purchasing managers reported an overall contraction in manufacturing economic conditions. The index stood at 47.2% in August, slightly less negative than the 46.8% recorded in July. The PMI® is a diffusion index, measuring the difference between the percent of respondents reporting expanding activity and those reporting contracting activity. (Many more respondents typically report no change in business activity.) A number below 50% means more respondents than not reported contracting activity. The overall PMI® is built up from a set of underlying indicators of factors ranging from new orders to shipments to supplier delivery lags. As the chart below shows, many of these have deteriorated compared with their values six months ago. See the ISM® report for a discussion of each index, as well as interesting select written comments from survey participants. The PMI® has tended to give a more negative view of the manufacturing sector than other indicators, such as durable goods orders or employment, which show more of a flat industry performance. Still, this particular set of forward looking indicators is of concern, considering the likelihood of weaker overall demand in coming months. hashtag#PMI hashtag#manufacturing

[@simecurkovic]

FYI: There is this new free thing called ChatGPT, chat.openai.com/chat It was founded by Elon Musk (big surprise), and was developed using open source AI. Basically, it is like doing Google searches on steroids. You type in your needs and it gives you back written responses as though a human did all of the research for you. It saves me from having to do 5-20 Google searches and when I use Google, I have to make sense out of it all and connect the dots. For me, ChatGPT will eventually make my need for Google searches obsolete. And that says a lot, because Google is the most used website on the planet (KZbin is second and is owned by Google). For me, ChatGPT will help me do my job better, faster, and cheaper. Currently, it is free, but that will not last for long. I assume the game plan is to monetize this right around the time we all starting using it for almost everything. I just wanted to share this with you on the chance you did not know about it. If you are well versed with this new technology, I would be grateful for any feedback. It is like talking to a professor and asking questions and the professor has all the answers. Further, the professor provides you with a very well written response to your questions. Today, I asked it: "Can you pretend that you are a recruiter and ask me sample interview questions as I am a supply chain major?" The AI proceeded to ask me 10 brilliant questions... Certainly! Here are a few sample interview questions for a supply chain major: How do you stay up-to-date with the latest industry trends and developments in supply chain management? Can you provide an example of a time when you successfully managed a complex supply chain project from start to finish? How do you approach problem-solving in the supply chain? Can you provide an example of a difficult problem you had to solve and how you went about finding a solution? In your opinion, what are the key success factors for a successful supply chain operation? Can you describe a situation where you had to juggle multiple priorities and meet tight deadlines in the supply chain? How did you handle the pressure and meet the challenges? How do you ensure the accuracy and reliability of data in the supply chain? Can you provide an example of a time when you had to analyze and interpret large sets of data to make informed decisions? How do you build and maintain strong relationships with suppliers and partners in the supply chain? Can you provide an example of a time when you had to negotiate with a difficult supplier and how you were able to come to an agreement? How do you approach risk management in the supply chain? Can you provide an example of a time when you had to mitigate a risk in the supply chain and how you did it? How do you stay organized and manage your time effectively in the supply chain? Can you provide an example of a time when you had to juggle multiple tasks and projects at once and how you stayed on top of everything? 10. Can you describe a situation where you had to deal with a difficult customer or stakeholder in the supply chain and how you handled the situation? Thank you. Sime -- Dr. Sime (Sheema) Curkovic, Ph.D., Professor, Operations/Supply Chain, Lee Honors College Faculty Fellow Western Michigan University, Haworth College of Business Kalamazoo, MI 49008-5429 | 269.267.3093 | [e-mail] The Western Way: "Better, faster, cheaper" www.wmich.edu/supplychain WMU: #1 in MI for earnings by graduates Sample Lectures: What is SCM? wmich.edu/supplychain/academics/lectures www.youtube.com/@simecurkovic WMU...One of nation's best undergrad SCM programs (Gartner); 2nd in technology (SoftwareAdvice); 2nd in top global talent (SCM World) Vitae: wmich.edu/marketing/directory/curkovic Connect: www.linkedin.com/in/sime-curkovic-61617a115/ Follow: www.simecurkovic.com/

[@simecurkovic]

I kid you not (for Michigan): “a 29.7% increase in demand for logisticians” & “The most in-demand, high-wage jobs will be operations managers, w/ an annual need of more than 6,500 & a wage of $29-72/hr”. HOWEVER, the greatest demand in the number of available jobs through 2030 is in LOW-wage jobs. That is going to be a problem: young people are leaving & people are having way fewer kids. www.linkedin.com/posts/sime-curkovic-61617a115_check-out-the-scm-data-science-jobs-activity-6999343528254328832-4aEV? Michigan's young population (0-25) has shrunk the MOST (-14%!). Birth rates have plunged in states where the 0-25 population is shrinking. Also,…There simply are not enough young people going into & working in the supply chain...lnkd.in/gMqxdxfr Note, there are not enough young people in general. Last year, deaths exceeded births in fully half of the US states. lnkd.in/geyWT2iH. lnkd.in/gPx65g2i Notice that all things SCM related such as "Logisticians" (4th highest) are off the charts in growth %. lnkd.in/gzqRPEPr & lnkd.in/g9T2fU_d. If you look at this 2020-2030 job growth chart below, again, all things SCM related scored VERY well (i.e., operations & logistics). lnkd.in/g_G-xwFv Basically, we are going to see 20-30% growth in SCM jobs over the next decade. Also, the jobs in SCM pay VERY well. Lastly, the data science jobs scored off the charts in growth & pay. So, SCM + data science = jobs & $. Finally, automation is killing all things manual (negative job growth). Note, there are not enough young people working in supply chain - lnkd.in/gtUcJpX7. Recessions tend to be very bad for college grads. However... this is NOT a labor recession. There are only (sarcasm) around 11M unfilled jobs. College grads, worry not (for now, not even close). Record low unemployment. For students going into SCM, the prospects are great, but do not be a victim of technology! Top 12 Skills You Need To Become a Data Scientist. lnkd.in/gwrjksAa. There are ONLY 500,000 unfilled SCM Data Science jobs on LI. Employers place a premium on - 1. Advanced Excel (power query & pivot) & macros; 2. Data visualization (Tableau, Power BI & python w/ seaborn & matplotlib); 3. Data mining/RapidMiner, machine learning & data science; 4. Python & Jupyter notebook (data analytics & statistical libraries such as pandas, numpy); 5. Relational data models (Excel data model); 6. Graphic & statistical libraries (Seaborn, Matplotlib, Pandas, & Plotly). Business analytics addresses an increasing demand in orgs of all types to understand data related to their operations. Investments in information systems throughout the enterprise over the last 10-15 years are generating tremendous amounts of data, & companies will spend at least the next 10 years developing processes that generate insight from those data (visualization is huge, think Tableau and Power BI). #supplychain #bigdata #dataanalytics #datavisualization #python

[@simecurkovic]

wmich.edu/news/2020/08/60747 WMU business professors see signs of economic recovery amid pandemic Contact: Erin Flynn August 19, 2020 KALAMAZOO, Mich.-COVID-19 upended life as we know it and sent the global economy into a tailspin. Unprecedented business shutdowns halted production in many areas, led to layoffs in others and left supply chains in a lurch. Now five months in, there are signs of hope the U.S. economy is on its way to recovery. Unemployment is decreasing, jobs are being created and investors are optimistic. That's the good news. But according to expert faculty in Western Michigan University's Haworth College of Business, restoring the pandemic-perturbed economy won't happen overnight, and it comes with significant caveats. "Roughly one-third of the U.S. economy revolves around, basically, four states: California, Texas, Florida and New York," says Dr. Sime Curkovic, professor of management. "(There are) a lot of unknowns, but it's not going to serve us well if states that account for over a third of our economy are now struggling with COVID. What happens if there's a second wave? What if vaccines don't get approved until next year? If vaccines do get approved, what if the effective rate is only 50%?" Since the pandemic first appeared in the United States, the country has lost approximately 30 million jobs. America's gross domestic product-essentially what the economy is worth-shrunk 33% from April to June. That's a deeper plunge than the Great Depression. "That's the worst in two centuries, actually. When you look at the prior declines in the economy, there are certain things that have worked," says Dr. Devrim Yaman, professor of finance and associate dean of undergraduate programs in the Haworth College of Business. "(Those include) investing in people and the health of people, and focusing on the industries that were already failing, because those industries are more vulnerable." Manufacturing Hope A leading indicator of America's economic health is the ISM Manufacturing Index. It measures the activity level of purchasing managers to determine things like production, shipment levels and inventories, and assigns a monthly numerical rating. If the number is above 50, manufacturing is expanding versus the previous month. "If you look at the ISM Manufacturing Index over the last several decades, it kind of tells you what's going to happen a few months down the road or a year down the road. Right before the Great Recession, the ISM Manufacturing Index was under 50 for some 30 months in a row," says Curkovic, adding that after the Great Recession, the U.S. economy grew every month for 131 months up until March 2020. "So, I think when bad things happen globally or in our economy, we tend to recover very quickly. Think of all the crazy stuff that happened during that time period: the dot-com bubble burst, the real estate bubble, the Great Recession, the banking crisis, September 11, (wars in) Iraq and Afghanistan, corporate scandal with Tyco and Enron. The list is endless. We have an economy that's capable of growing to crank out as many jobs as we need to put people to work that want jobs." The reason the ISM Manufacturing Index is so influential is that manufacturing drives the American economy. While only about 10% of the U.S. workforce is in the manufacturing sector, each of those jobs accounts for about 10 jobs in the service sector. The index has been above 50 now for approximately two months-a sign that manufacturing is on the upswing and jobs are being added. If that trend continues, Curkovic predicts the U.S. could potentially see a complete economic recovery in 12 months. "We should look forward to the future given that we've only been a few months into this and we're already above 50 (on the ISM Manufacturing Index) and tons of jobs are being created," he says, also pointing out that a driving factor in keeping the positive momentum will be the global economy and ability of other countries to recover post-COVID-19. "We can't stand alone in a global economy." Investing in future success In the short term, Yaman says, the best way to encourage positive growth is to invest in services and technologies aimed at studying, controlling and, if possible, eliminating the novel coronavirus. "Really without the social distancing, wearing our masks and investing in a vaccine, our economy will not recover. We know that. So, it looks like the best places to invest and pay attention to are the COVID-related areas." It's also important to focus on policies and decisions with long-term sustainability in mind, rather than immediate solutions that offer only short-term relief. An economic stimulus is important, for instance, but not sustainable over time. "A lot of individuals are in declining industries. How do we relocate those individuals so that we can have them work in industries where there is more need? How do we support innovation?" Yaman says. "This is the time to make more investments in research and development throughout the country, as well as in companies, and particularly investing in more education (for workers)." Education will be essential for those workers whose jobs are eliminated as industries shift to accommodate the needs and lifestyle changes of a post-COVID-19 world. While many jobs in the hospitality industry have been lost, for instance, sectors like health care and engineering are seeing an exponential increase in demand. "This pandemic is forcing all of us to be more efficient and to look at things in a different way, just to see in the long run how we can make ourselves better," says Yaman.

[@simecurkovic]

What is the PMI? Do you understand how to interpret the ISM MFG index (also called the PMI-Purchasing Managers’ Index). lnkd.in/ehGkiNg www.linkedin.com/posts/sime-curkovic-61617a115_do-you-understand-how-to-interpret-the-ism-activity-6773632481020166144-JeO- For example, if it is above 50, what does that mean? If it is below 50, what does that mean? The news is VERY good. If the ISM PMI MFG Index is above 50 for the month, then that simply means mfg output expanded compared to the previous month. That is good because if it keeps being above 50 every month that means we are cranking out more stuff & that means jobs will be created. The Feb Mfg PMI registered 60.8%, an increase of 2.1% points from the Jan reading of 58.7%. This figure indicates expansion in the overall economy for the 9th month in a row after contraction in March, April, & May. The BETTER NEWS: ISM®’s Employment Index registered 54.4 percent in February, 1.8% points higher than the Jan reading of 52.6 percent. “The Employment Index grew for the third month in a row!" If mfg continues to expand, mfg will hire more people, when that happens, it creates even more jobs in the service sector (which is where most people work). Things are looking better! Remember, 1 factory job creates another 10-20 jobs for everywhere else. What is our potential? Well, Pre-covid, the U.S. economy grew 131 months in a row! New streak on the way!

[@simecurkovic]

Inflation: A number of goods have actually gone down in the index, including: lnkd.in/gR4rzPEm. Which countries have the highest inflation? lnkd.in/guK88cW8. FYI, 70% of current contracts have price increase provisions?! lnkd.in/g_ByzrNU. Great post & read below. Our SCM program is fortunate to be working w/ industry partners such as N-Alpha. This Spring our students are looking at raw material market data from multiple sources. We will visualize & analyze historical pricing scenarios & do some simulating on planned purchases & what-if scenarios against forward price curves. It beats manually updating giant color coded Excel spreadsheets. Stay tuned for some white papers from the WMU SCM program based on price analysis & strategic cost management research... Some of our alumni are already testing and / or implementing automated business processes based on such tools, serving as the basis for addressing price indexing implementations (formulas, economic adjustments, etc.) by champions in a few larger orgs, and we're following these implementations from an academic perspective. __ Eyal Mizrahi• CEO and Co-Founder of N-Alpha • lnkd.in/gyj4aJSQ Economic adjustments and price increase provisions come up very often in our discussions with companies. Inflation has become a pain point for companies of all shapes and sizes. In fact, this 2022 study from World Commerce & Contracting, which interviewed 443 respondents across 23 different industries, found that around 70% of current contracts have price increase provisions. A supplier / customer is requesting economic adjustments for raw materials price exposure. How will you manage this? With our operating system for raw materials pricing driven business processes, we automate custom data, calculations, time stamps, and alerts. Talk with us and avoid building and maintaining monster spreadsheets. __ Great read & spot on - Rising Interest Rates: Maybe It’s Time to Bring Back the Forgotten Art of Price Analysis | Robert Handfield Ph.D. lnkd.in/gTjJfyaQ #inflation, #procurement, #rawmaterials, #supplychain, #scm, #indexing #ppi #producerpriceindex

[@simecurkovic]

kzbin.info/www/bejne/an2zg5WJhp6Kos0&feature=emb_logo WMU business professors see signs of economic recovery amid pandemic

[@simecurkovic]

kzbin.info/www/bejne/an2zg5WJhp6Kos0&feature=emb_logo wmich.edu/news/2020/08/60747 WMU business professors see signs of economic recovery amid pandemic Contact: Erin Flynn August 19, 2020 KALAMAZOO, Mich.-COVID-19 upended life as we know it and sent the global economy into a tailspin. Unprecedented business shutdowns halted production in many areas, led to layoffs in others and left supply chains in a lurch. Now five months in, there are signs of hope the U.S. economy is on its way to recovery. Unemployment is decreasing, jobs are being created and investors are optimistic. A manufacturing employee lifts a drumhead off of a stack next to a production line. An employee of international music accessories manufacturer D'Addario & Company helps create face shields from materials used in producing drumheads. The company is one of many that shifted operations in response to the pandemic. (Bruce Bennett/Getty Images) That's the good news. But according to expert faculty in Western Michigan University's Haworth College of Business, restoring the pandemic-perturbed economy won't happen overnight, and it comes with significant caveats. "Roughly one-third of the U.S. economy revolves around, basically, four states: California, Texas, Florida and New York," says Dr. Sime Curkovic, professor of management. "(There are) a lot of unknowns, but it's not going to serve us well if states that account for over a third of our economy are now struggling with COVID. What happens if there's a second wave? What if vaccines don't get approved until next year? If vaccines do get approved, what if the effective rate is only 50%?" Since the pandemic first appeared in the United States, the country has lost approximately 30 million jobs. America's gross domestic product-essentially what the economy is worth-shrunk 33% from April to June. That's a deeper plunge than the Great Depression. "That's the worst in two centuries, actually. When you look at the prior declines in the economy, there are certain things that have worked," says Dr. Devrim Yaman, professor of finance and associate dean of undergraduate programs in the Haworth College of Business. "(Those include) investing in people and the health of people, and focusing on the industries that were already failing, because those industries are more vulnerable." Manufacturing Hope A leading indicator of America's economic health is the ISM Manufacturing Index. It measures the activity level of purchasing managers to determine things like production, shipment levels and inventories, and assigns a monthly numerical rating. If the number is above 50, manufacturing is expanding versus the previous month. "If you look at the ISM Manufacturing Index over the last several decades, it kind of tells you what's going to happen a few months down the road or a year down the road. Right before the Great Recession, the ISM Manufacturing Index was under 50 for some 30 months in a row," says Curkovic, adding that after the Great Recession, the U.S. economy grew every month for 131 months up until March 2020. "So, I think when bad things happen globally or in our economy, we tend to recover very quickly. Think of all the crazy stuff that happened during that time period: the dot-com bubble burst, the real estate bubble, the Great Recession, the banking crisis, September 11, (wars in) Iraq and Afghanistan, corporate scandal with Tyco and Enron. The list is endless. We have an economy that's capable of growing to crank out as many jobs as we need to put people to work that want jobs." The reason the ISM Manufacturing Index is so influential is that manufacturing drives the American economy. While only about 10% of the U.S. workforce is in the manufacturing sector, each of those jobs accounts for about 10 jobs in the service sector. The index has been above 50 now for approximately two months-a sign that manufacturing is on the upswing and jobs are being added. If that trend continues, Curkovic predicts the U.S. could potentially see a complete economic recovery in 12 months. "We should look forward to the future given that we've only been a few months into this and we're already above 50 (on the ISM Manufacturing Index) and tons of jobs are being created," he says, also pointing out that a driving factor in keeping the positive momentum will be the global economy and ability of other countries to recover post-COVID-19. "We can't stand alone in a global economy." Investing in future success In the short term, Yaman says, the best way to encourage positive growth is to invest in services and technologies aimed at studying, controlling and, if possible, eliminating the novel coronavirus. "Really without the social distancing, wearing our masks and investing in a vaccine, our economy will not recover. We know that. So, it looks like the best places to invest and pay attention to are the COVID-related areas." It's also important to focus on policies and decisions with long-term sustainability in mind, rather than immediate solutions that offer only short-term relief. An economic stimulus is important, for instance, but not sustainable over time. "A lot of individuals are in declining industries. How do we relocate those individuals so that we can have them work in industries where there is more need? How do we support innovation?" Yaman says. "This is the time to make more investments in research and development throughout the country, as well as in companies, and particularly investing in more education (for workers)." Education will be essential for those workers whose jobs are eliminated as industries shift to accommodate the needs and lifestyle changes of a post-COVID-19 world. While many jobs in the hospitality industry have been lost, for instance, sectors like health care and engineering are seeing an exponential increase in demand. "This pandemic is forcing all of us to be more efficient and to look at things in a different way, just to see in the long run how we can make ourselves better," says Yaman.

[@simecurkovic]

www.linkedin.com/posts/sime-curkovic-61617a115_what-is-pmi-purchasing-managers-index-activity-7004128036358926336--kNP? Ugh. The Nov ISM MFG PMI just came in at 10 am Dec. 1st: “The Nov PMI was 49%, 1.2% < than the 50.2% in Oct. The MFG PMI figure is the lowest since May 2020. Also: ISM’s Employment Index was 48.4% in Nov, 1.6% points < han the Oct reading of 50%. The index indicated employment contracted after being unchanged for one month.” lnkd.in/dycYDKyy This is not great news, but it might not be terrible news. It becomes a big deal if it stays under 50 for several months in a row. Why? Because that will create job losses. No one wants a labor recession in 2023, especially my college grads. I am NOT betting against the U.S. economy. Pre-covid, the U.S. economy grew 131 months in a row! FYI: A PMI > 48.7%, over a period of time, generally indicates an expansion of the overall economy. We are above that 30 months in a row now since covid. Make sure you understand how to interpret the ISM MFG index (also called the PMI - Purchasing Managers’ Index). For example, if it is > 50, what does that mean? If it is < 50? If the ISM PMI MFG Index is > 50 for the month, then that simply means U.S. mfg output expanded compared to the previous month. That is good because if it keeps being > 50 every month that means we are cranking out more & more stuff & that means JOBS will be created (eventually). Economic activity in the mfg sector shrunk in Oct for the first time in 29 months, first since 2020 - March, April, and May (covid). Covid shrunk the U.S. economy for only 3 months! Before the covid contraction in 2020, the U.S. economy grew "131" consecutive months. Not bad, right? Note, pre-great recession, in 2008, the U.S. economy grew every month 1991-2007 (for the most part). All indications are that the U.S. might be the only economy that has experienced a growth surge since covid. Why does this matter to the gov & us? Answer: If MFG keeps shrinking month to month, our overall economy will start to shrink (eventually that means LABOR recession). During the 2006-2009 time period, the ISM MFG & employment indices were < 50 for several years, for nearly 40 consecutive months. Long before America started its overall economic great recession in 2008, there was a mfg recession going on. Many economists believe the ISM MFG index is a precursor & leading economic indicator for what will happen in the overall economy. It certainly predicted the great recession of 2008. That is why people were freaking out over the ISM MFG Index being < 50 when covid hit and again now in Oct. While only 10% of Americans work in mfg, the remaining 90% employed in the service sector are either directly or indirectly connected to those mfg jobs. So, people losing their jobs in MFG matters to everyone in the economy! Each MFG job creates 10-20+ other jobs. More info on PMI & the job market... lnkd.in/euRd74NQ lnkd.in/ez4HYBWj #pmi #manufacturing #supplychain #recession

[@simecurkovic]

I actually have employers tell me they will NOT consider a student if they do NOT have a strong professional LinkedIn presence. Hmm. How to effectively join LinkedIn. lnkd.in/dAwyTUy. I have former students that found new jobs & they were not even looking! Interviewing tools: lnkd.in/gipsXEsK. www.linkedin.com/posts/sime-curkovic-61617a115_does-your-resume-look-like-a-lazy-effort-activity-7010575035400687616-y6lS? Also, most employers will not even look at your resume if it looks like a lazy effort. Aesthetics matter! Yale advice: lnkd.in/gggJFADW lnkd.in/gxkjy3sm Harvard: lnkd.in/ghEYr3Qw lnkd.in/gc4Kd_SE MIT: lnkd.in/g3xqeDyc Personally, I prefer WMU’s Career Services manual. Also, WMU HCOB/ISM has a great ROI (just ask my students starting at 70K & making over six digits by age 30). Keep in mind that many schools such as Harvard ($54K/yr tuition), Yale ($58K/yr), & Stanford ($57K/yr) don't offer undergrad business degrees. WMU ($13K/yr) - A Top Business School (take a look at the list): lnkd.in/dn9-BCg Should current students negotiate an INTERNSHIP offer? The avg SCM internship is $44,918/yr, or $21.6/hr. People on the lower end, bottom 10%, make $37K/yr ($17.80/hr), while the top 10% makes $54K ($25.96/hr). lnkd.in/gpBm_m84 Should grads negotiate a job offer (i.e., a higher starting salary)? lnkd.in/gMJYNJkh Virtual career fairs: lnkd.in/evKd-VzQ Business externship? lnkd.in/e9aeewPa Placement success of ISM Program - *Median salary was $60K - $65K (around 10% of grads hired on w/ 1 auto OEM at $78K!). "Supply Chain"+"Degree"=jobs & $$. lnkd.in/gV4x6GWE Will technology replace SCM jobs? lnkd.in/gX8vcRNa Global Negotiation: Fastest growing class. lnkd.in/guTUcvdu A Top School: lnkd.in/dVdMRXP Sample Lectures: lnkd.in/e9j33EQ Power BI or Tableau? Do not be a victim of technology. lnkd.in/eKEaPGq lnkd.in/e5zG6sZ Here is a read on how SCM 4.0 does not have to be super expensive: lnkd.in/eyebnSct How much Python do I need to know in order to excel in SCM? lnkd.in/e6Rmzpw STAR job interviews & online robots… lnkd.in/ePzz3NG lnkd.in/eZgTxWc lnkd.in/eyCv4x5 lnkd.in/eaxVjpK Myers-Briggs. lnkd.in/ehj3ysR For details on how to build your brand: lnkd.in/dSAA6wF Similar to MBTI: lnkd.in/ey4TEUY lnkd.in/exNDhSv Help with online interviews...lnkd.in/eKBDsMq Practice before it really matters...lnkd.in/ekaBK5Q Resume advice... lnkd.in/eWen96qj lnkd.in/e7utipBi lnkd.in/eVEHgvk6 Internships, salary data, etc. lnkd.in/eNfUzksJ Covid job market… lnkd.in/ed-ZfanD Delay graduation for experience? lnkd.in/ewKu7b_X Right time for grad school? lnkd.in/eTk-PXPv Predictive Data Analytics (Excel)…lnkd.in/dQABdsXc Problem solving #1 skill set! Elon's resume - lnkd.in/eWaJ8q2 #jobhunting #networking #interviewing

[@simecurkovic]

Are Supply Chain professionals using ArcGIS Pro technology? Do you think our SCM students should learn this? ArcGIS is a technology that can help companies manage risk. Nationally, almost zero SCM graduates will have this on their resume. I recently had a GIS analyst reach out to me & ask: Is there a business geography specialty group that addresses supply chain issues? Where could people find GIS supply chain problem sets? I think he sees GIS+SCM as being very timely. I reached out to a GIS geography colleague & the feedback was…There is a Business Specialty Group of the American Association of Geographers (AAG). lnkd.in/gS98FvHC There are a lot of interesting examples of Supply Chain issues & GIS at the ESRI website. lnkd.in/ge9FqbKH Some of the interesting best practices involve dashboard type views of interruptions: lnkd.in/gMrb-pfy There are also advanced operations in ArcGIS Enterprise: lnkd.in/g3ZBxhxV As for problem sets, there are often interesting datasets and suggestions for solving complex problems on GitHub. A quick looks shows a lot of Python type modeling for Supply Chain on GitHub. In terms of teaching, most of these topics are beyond our intro level GIS course. However, we also teach GEOG 5690: GIS Workflows, where students learn more about dashboards & origin-destination analysis, & work on 4 mini-projects w/ a data type of their choosing. We will teach a Project Mgmt & Programming course (GEOG 4670/6670) that could also be useful to SCM students. Here are some entries in the GIScience Body of Knowledge/encyclopedia that might be helpful to have students read: lnkd.in/gsPEeBYt lnkd.in/gKsXcT_X lnkd.in/g5M-B88t Also, if you want to find where the business geographers publish, they typically aim for 'applied geography' journals: lnkd.in/gMxzs3UX lnkd.in/gaUAszSX _ Our Intro GEOG 3010 - Fundamentals of GIS An intro course that covers the use and application of geographic information systems (GIS). It combines an overview of general principles of GIS & practical experience in map creation & the use of spatial information, including fundamental aspects of measurement, representation & analysis. Intro GIS focuses on the basics of working w/ both vector & raster data, as well as the societal aspects of GIS (emerging uses, interaction w/ new technologies, data standards, public access to information). We upgraded the course to ArcGIS Pro, which works better in online environments; we are going to have a dedicated Mac-user office hour period, for Mac users that will have to use remote desktop or some kind of Windows-on-Mac system; AND we are using COVID and racial disparities data through the semester so that students really get a handle on some of this real data w/o relying on the interpretation of others. Students will also have access to all of the ESRI tutorials on how to build COVID dashboards (& other dashboards of that type). See comments: www.linkedin.com/posts/sime-curkovic-61617a115_can-gis-help-ease-supply-chain-problems-and-activity-6971445299403788288-LcT5?

[@simecurkovic]

More great mfg news... www.reuters.com/article/us-usa-economy-manufacturing/u-s-manufacturing-activity-at-19-month-high-in-august-idUSKBN25S5A1?feedType=mktg&feedName=topNews&WT.mc_id=Partner-Google U.S. manufacturing activity in nearly two years in August WASHINGTON (Reuters) - U.S. manufacturing activity accelerated to a nearly two years in August amid a surge in new orders, but employment continued to lag, supporting views that the labor market recovery was losing momentum. The Institute for Supply Management (ISM) said on Tuesday its index of national factory activity increased to a reading of 56.0 last month from 54.2 in July. That was the highest level since November 2018 and marked three straight months of growth. Related Coverage U.S. construction spending almost flat in July: Commerce Department A reading above 50 indicates expansion in manufacturing, which accounts for 11% of the U.S. economy. Economists polled by Reuters had forecast the index would rise to 54.5 in August. But the continued improvement in manufacturing is uneven, as the COVID-19 pandemic shifts spending away from equipment used in the services industries such as restaurants and bars to purchases of goods like home electronics. The ISM’s forward-looking new orders sub-index increased to a reading of 67.6 in August, the strongest since December 2017, from 61.5 in July. The survey’s measure of order backlogs at factories accelerated as did orders for exports. Though factory employment continued to improve last month, it remained in contraction territory. The ISM’s manufacturing employment measure rose to a reading of 46.4 from 44.3 in July. Factory employment was already in decline before the coronavirus crisis because of the Trump administration’s trade war with China. Its struggle to rebound even as orders received by factories are rising fits in with economists’ views that the labor market was losing steam after being boosted by the reopening of businesses in May. The government’s closely followed employment report to be released on Friday is expected to show 1.4 million jobs created in August after adding 1.763 million in July, according to a Reuters survey of economists. That would leave nonfarm payrolls about 11.5 million below their pre-pandemic level.

[@simecurkovic]

Side note: My heart goes out to America’s working class. My immigrant father was a United Auto Workers (UAW) union worker for General Motors and we lived the American dream because of it. Those days are unfortunately gone because the American manufacturing laborer is competing against non-Americans who will work for much less money (around $1/hr in China and $4/hr in Mexico). Free trade agreements (NAFTA, CAFTA, WTO, etc.) with underdeveloped countries have perpetuated this situation. There will be no end in sight because the global economy revolves around generating shareholder value. The ability of American companies to invest abroad has benefited very large portions of our workforce, but it has also left several behind. This brings me to the real problem at several of America’s more mature manufacturing companies whose hourly workers tend to still have strong union representation. You can blame what might be overpaid hourly workers, but mismanagement is at the heart of the problem on both the management and union side. For example, the stock prices of these manufacturing dinosaurs has slipped because of an inability to generate a positive and large return on investment. Yes, these companies make money (sometimes and often), but its net income as a percentage of total sales is small and that turns investors away. The only way these companies can improve its return on investment is to widen margins and improve its asset turnover rate. Reducing their direct labor costs will widen margins and improve the return on investment. They could increase sales, but that is not easy in the saturated and competitive U.S. market which is still the largest economy in the world. I also realize that these companies are competing against companies that have much lower direct labor costs. However, where do most of their costs come from? Most of their costs come from direct material purchases and overhead (not direct labor). Another way to improve return on investment is to manage and reduce inventory because that would increase your asset turnover rate. My point is that management and union leadership have let its shareholders down more so than its hourly workers. Management needs to more effectively reduce its direct material and overhead costs, and better manage its assets such as inventory. They should work with their hourly workforce to implement lean manufacturing techniques that are proven methods for reducing costs and improving performance. The unions should also bend over backwards with open arms to help management implement these techniques. Fortunately, all of this is happening and will hopefully contribute to more positive news as is being reflected in a growing economy with record low unemployment. So where are we at now? Rehash... The June PMI® registered 52.6 percent, up 9.5 percentage points from the May reading of 43.1 percent. This figure indicates expansion in the overall economy for the second straight month after April’s contraction, which ended a period of 131 consecutive months of growth. Did you catch that above? Pre-covid, the U.S. economy grew 131 months in a row! Note, pre-great recession, in 2008, the U.S. economy grew every month 1991-2007 (for the most part). The U.S. is a job creation machine! If the ISM PMI MFG Index is above 50 for the month, then that simply means American mfg output expanded compared to the previous month. That is good because if it keeps being above 50 every month that means we are cranking out more and more stuff and that means jobs will be created. So, covid hit us. What happened? In March, April, and May, the PMI was under 50. Big surprise, right? But, for June, the PMI was above 50! If that number stays above 50 moving forward each month, that might mean the worst is behind us. Why does this matter to the government and us? Answer: If MFG keeps shrinking month to month, our overall economy will start to shrink (eventually that means recession). You do not want to be graduating during a recession (though you will still be fine). Note, before manufacturing started shrinking 4 months ago (PMI under 50), the PMI was above 50 for the better part of 3 years (MFG was increasing). Not surprisingly, the ISM Employment Index has been under 50 for the last 11 consecutive months! Did you catch that? MGF employment was shrinking before covid hit us. That's why some people think we were kind of slowing down or heading towards a mild recession before covid and then covid just took us there officially. That means manufacturing employment has shrunk every month for 11 months straight. Does that make sense? The ISM MFG Index was under 50 for 3 months (March, April, May) in a row (MFG output shrunk bigtime), so they got rid of lots of workers and that is why the ISM Employment Index continues to be under 50. While only 10-15% of Americans work in manufacturing, the remaining 85-90% employed in the service sector are either directly or indirectly connected to those manufacturing jobs. So, people losing their jobs in MFG matters to everyone in the economy! Everyone needs the ISM MFG index to be above 50 every month, then the ISM employment index will eventually get above 50 every month (jobs are being created) and then that will spill over into the service sector (which is where most Americans work). Does it make sense to you why MFG jobs are so important to the U.S. economy even though they only employ 10% of America's workforce? Each MFG job might create 5-20 jobs in the service sector indirectly. That factory in town might employ 1000 people with great paying jobs but those jobs create supplier jobs and service sector jobs. Those service sector jobs include: the pizza shop in town, the accountants in town, the lawyers in town, the nurses in town, the grocery stores in town, etc. During the 2006-2009 time period (your childhood, do you remember?), the ISM MFG and employment indices were below 50 for several years, for nearly 40 consecutive months. Long before America started its overall economic great recession in 2008, there was a manufacturing recession going on. Many economists believe the ISM MFG index is a precursor and leading economic indicator for what will happen in the overall economy. It certainly predicted the great recession of 2008 and is the reason, especially supply chain managers, need to follow this measure more closely. That is why people are freaking out over the ISM MFG Index being under 50 in March, April, and May. But, we bounced back over 50 in June!!!

[@simecurkovic]

Side Note (I know repetitive): Today, for the first time in American history, most manufacturing jobs are not out on the shop floor but are instead in office cubicles. America has the most productive manufacturing workforce on the planet and can produce six times the product with the same amount of workers as it could 40 years ago. However, this productivity phenomenon should serve as a warning to all American workers that you have to be good at something that cannot be outsourced. Most of the jobs in manufacturing now require a college degree or trade skill. These jobs that require a college degree (production control, inventory management, procurement, etc.) or a trade skill (electrician, plumber, welder, machinist, etc.) command good salaries because they are not competing against non-Americans. I know it is easier said than done, but we need to work harder to develop these skills so that we will not be as adversely affected by globalization. The American manufacturing laborer is competing against non-Americans who will work for much lower wages (around $1-$3/hr in China and $4-$8/hr in Mexico). Free trade agreements (NAFTA, CAFTA, WTO, TPP, etc.) with developing countries have perpetuated this situation. There will be no end in sight because the global economy revolves around generating shareholder value. The ability of American companies to invest abroad has benefited very large portions of our workforce, but it has also left several behind. This brings me to the real problem at several of America’s more mature manufacturing companies whose hourly workers tend to still have strong union representation. You can blame what might be overpaid hourly workers, but mismanagement is at the heart of the problem on both the management and union side. For example, the stock prices of these manufacturing companies has slipped because of an inability to generate a positive and large return on investment. Yes, these companies make money (sometimes and often), but a firm’s net income as a percentage of total sales is small and the thin margins that accompany that turn investors away. The only way these companies can improve their return on investment is to widen margins and improve their asset turnover rate (ROI = Profit Margin * Asset Turnover Rate). One way to do this is to reduce direct labor costs. They could also increase sales, but that can prove difficult in the saturated and competitive U.S. market. These companies are competing against others with much lower direct labor costs. So, where do most of their costs come from? Most come from direct material purchases (over 50%) and overhead. Another way to improve return on investment is to optimize supply chain performance because that would help widen margins by reducing costs and increasing asset turnover rate. Management and union leadership have let their shareholders down more so than their hourly workers. Management needs to more effectively reduce their firms’ direct material and overhead costs while better managing supply chain assets such as inventory. They should work with their hourly workforce to implement lean manufacturing techniques that are proven methods for reducing costs and improving performance. The unions should also bend over backwards with open arms to help management implement these techniques. Fortunately, all of this is happening and will hopefully contribute to more positive news as is being reflected in the ISM manufacturing and employment indices. Bottom line, ISMers will be fine either way. Major in something where demand exceeds supply and do something where you are not competing against Mexican and Chinese workers that will work for less than $5 per hour. I am guessing that someone who works for less than $5 per hour cannot read CAD drawings, negotiate a contract, perform data analytics, use SAP/ERP, etc.

[@simecurkovic]

Economic activity in the manufacturing sector grew in October, with the overall economy notching a sixth consecutive month of growth, say the nation’s supply executives in the latest Manufacturing ISM® Report On Business®. “The October Manufacturing PMI® registered 59.3 percent, up 3.9 percentage points from the September reading of 55.4 percent and the highest since September 2018 (59.3 percent). This figure indicates expansion in the overall economy for the sixth month in a row after a contraction in April, which ended a period of 131 consecutive months of growth. ISM®’s Employment Index registered 53.2 percent in October, 3.6 percentage points higher than the September reading of 49.6 percent. “Following 14 consecutive months of contraction, the Employment Index moved back into expansion territory. In my opinion, if the ISM PMI continues to be above 50, and factories continue to create new jobs (which they did in October), then this is the beginning of a steep V shaped recovery. If the ISM PMI is only slightly above 50 or even under 50 moving forward, then it will be not be a V shaped recovery because not enough new factory jobs will be created. Remember, 1 factory job creates another 10-20 jobs for everywhere else.