Important Update to ISM® Projected 2024 Seasonal Factors

TEMPE, Ariz., Jan. 26, 2024 /PRNewswire/ — ISM^® identified an issue that affected our 2024 projected seasonal factors. The error was swiftly rectified, and the accurate data is contained in the below tables.

Based on input from an independent expert, Institute for Supply Management^® (ISM^®) recently announced the completion of its annual adjustments to the seasonal factors used in the monthly ISM^® Manufacturing PMI^® Report On Business^® and the monthly ISM^® Services PMI^® Report On Business^®. Purchasing managers and economists who track these indexes will note that changes are effective with the January 2024 ISM^® Manufacturing PMI^®, which is scheduled to be released on February 1, 2024, and the January 2024 ISM^® Services PMI^®, which will be released on February 5, 2024.

Seasonal adjustment factors are used to allow for the effects of repetitive intra-year variations resulting primarily from normal differences in weather conditions, various institutional arrangements, and differences attributable to non-movable holidays. It is standard practice to project the seasonal adjustment factors used to calculate the indexes one year ahead (2024).

As in previous years, the X-13-ARIMA program was used to develop the revisions to the Manufacturing and Services indexes for January 2021 through December 2023, as well as the 2024 projected seasonal factors. The 2024 seasonal factors will be recomputed when the actual data are known in early 2025. Projected seasonal factors for 2024 are shown below.

2024 Seasonal Adjustment Factors for ISM^® Manufacturing PMI^® Indexes

To compute the Manufacturing PMI^® Index and Subindexes:

1)  Calculate the unadjusted diffusion index for New Orders, Production, Employment and Inventories (percent higher plus one half of the percent same or unchanged) to two decimal places and Supplier Deliveries (percent slower plus one half of the percent same or unchanged) to two decimal places.

2)  Divide each unadjusted diffusion index by its seasonal factor and round each quotient to one decimal place.

3)  Add all five quotients (index numbers) together and divide by five to arrive at the seasonally adjusted Manufacturing PMI^® Index.

4)  For each of the five other subindexes, calculate the diffusion index by adding together percent higher and one half of the percent same or unchanged, then rounding that sum to two decimal places.

2024 Seasonal Adjustment Factors for ISM^® Services PMI^® Indexes

To compute the Services PMI^® Index and Subindexes:

1)  Calculate the unadjusted diffusion index for New Orders, Business Activity, and Employment (percent higher plus one half of the percent same or unchanged) to two decimal places and Supplier Deliveries (percent slower plus one half of the percent same or unchanged) to two decimal places.

2)  Divide each unadjusted diffusion index by its seasonal factor and round each quotient to one decimal place.

3)  Add all four quotients (index numbers) together and divide by four to arrive at the seasonally adjusted Services PMI^® index.

4)  For each of the six other subindexes, calculate the diffusion index by adding together percent higher and one half of the percent same or unchanged, then rounding that sum to two decimal places.

Please note that differences in rounding practices may result in computed values that differ from published values.

About ISM^® Report On Business^®
The ISM^® Report On Business^® is considered by many economists to be the most reliable near-term economic barometer available. It is reviewed regularly by top government agencies and economic and business leaders for its timely, accurate information. The Manufacturing and Services ISM^® Report On Business^® is published monthly by Institute for Supply Management^®. Each month, both reports are compiled from responses to questions asked of purchasing and supply executives across the country and reflects change, if any, in the current month compared to previous months.

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About Institute for Supply Management^®
Institute for Supply Management^® (ISM^®) is the first and leading not-for-profit professional supply management organization worldwide. Its community of more than 50,000 in more than 100 countries manage about US$1 trillion in corporate and government supply chain procurement annually. Founded in 1915 by practitioners, ISM is committed to advancing the practice of supply management to drive value and competitive advantage for its members, contributing to a prosperous and sustainable world. ISM empowers and leads the profession through the ISM^® Report On Business^®, its highly-regarded certification and training programs, corporate services, events, and assessments. The ISM^® Report On Business^®, Manufacturing, Services, and Hospital, are three of the most reliable economic indicators available, providing guidance to supply management professionals, economists, analysts, and government and business leaders. For more information, please visit: www.ismworld.org.

SOURCE Institute for Supply Management

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