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ISM chart and excerpts below by permission from the Institute for Supply Management® ISM®

Please consider the June 2025 Manufacturing ISM^® Report On Business^® by Susan Spence, Chair of the Institute for Supply Management^®.

“The Manufacturing PMI® registered 49 percent in June, a 0.5-percentage point increase compared to the 48.5 percent recorded in May. The overall economy continued in expansion for the 62nd month after one month of contraction in April 2020.

“In June, U.S. manufacturing activity slowed its rate of contraction, with improvements in inventories and production the biggest factors in the 0.5 percentage point gain in the Manufacturing PMI®.

“The demand indicators remain mixed, with the New Orders and Backlog of Orders indexes contracting at faster rates, while the Customers’ Inventories and New Export Orders indexes contracted at slower rates. A ‘too low’ status for the Customers’ Inventories Index is usually considered positive for future production.

“Regarding output, the Production Index increased month over month and is now in expansion territory, however; the Employment Index dropped further into contraction as managing head count is still the norm, as opposed to hiring. The mixed indicators in output suggest companies still being cautious in their hiring even with an increase in production.

What Respondents Are Saying

• “Business has notably slowed in last four to six weeks. Customers do not want to make commitments in the wake of massive tariff uncertainty.” [Fabricated Metal Products]
• “Middle East unrest as well as unstable long-term tariff positions continue to impact second- and third-tier sources, which is applying pressure to material costs. Costs are up 6 percent to 10 percent over budgeted inflation — and the forecast accounted for the volatility expected with the current administration.” [Wood Products]
• “The biopharmaceutical space is starting to see more pronounced headwinds: Stock prices have significantly eroded, companies are facing hiring freezes, and so on.” [Chemical Products]
• “The tariff mess has utterly stopped sales globally and domestically. Everyone is on pause. Orders have collapsed.” [Machinery]
• “Tariff volatility has impacted machinery, steel and specialized components. Also, potential shortages of skilled labor for construction, maintenance and installation.” [Food, Beverage & Tobacco Products]
• “Tariffs continue to cause confusion and uncertainty for long-term procurement decisions. The situation remains too volatile to firmly put such plans into place.” [Computer & Electronic Products]
• “Tariffs continue to impact material pricing.” [Petroleum & Coal Products]
• “Tariffs, chaos, sluggish economy, rising prices, Ukraine, Iran, geopolitical unrest around the world — all make for a landscape that is hellacious, and fatigue is setting in due to dealing with these issues across the spectrum. Unfortunately, this is just the beginning unless something drastically changes, but the supply chain implications will grow — depots will not be stocked, less material will be available, and it will take years for domestic production to handle the needs (if companies even want to).” [Primary Metals]
• “The geopolitical environment remains volatile: (1) ongoing shifts in U.S. tariff policy make it difficult to plan, (2) emerging conflicts in the Middle East could pose long-term commodity risks and (3) China measures on rare earth materials are causing challenges. Overall outlook for our company is positive; it’s just extremely hard to make near-term supply plans/strategies or budgets.” [Miscellaneous Manufacturing]
• “The word that best describes the current market outlook is ‘uncertainty.’ The erratic trade policy with on-again/off-again tariffs has led to price uncertainty for customers, who appear to be prepared to hold off large capital purchases until stability returns. This has resulted in further reductions in customer demand and softening sales for the balance of 2025. Operations has planned additional weeks of downtime at multiple plants to accommodate reduced orders. Next year’s forecast is not any better at this point. Additionally, most electric vehicle (EV) projects have been delayed or canceled, resulting in a significant amount of unutilized capital investment. EV technology launches for 2026-28 have been delayed past 2030.” [Transportation Equipment]

That’s one hell of a set of comments. They are anecdotes not data, but representative of the damage Trump is causing.

Related Posts

June 30, 2025: Trump’s 90 Deals by July 9 Morphs Into a Quasi Labor Day Target

With 9 days remaining [now 8], Trump has only one deal, and it’s just a framework.

The Death of Reciprocal Tariffs

On May 28, the Court of International Trade struck down Trump’s reciprocal tariffs.

Trump’s violations of law were so flagrant that the court went straight to a summary judgment instead of issuing a temporary restraining order (TRO) while hearing further arguments.

However, On June 2, I noted Trump Gets a Meaningless Stay on Tariff Ruling.

Trump got a stay on reciprocal tariff rejections, but he has other options.

Please read the above post for all the reasons Trump will lose the appeal.

Meanwhile, Trump pretends to make deals. And nations pretend to negotiate in good faith.

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