The US manufacturing sector grew in August at the same rate as in July — which was the lowest rate in more than two years, according to the Institute for Supply Management’s “Manufacturing ISM Report on Business.” Employment in manufacturing picked up, though concerns about a slowing economy remained.

The Manufacturing PMI report is based on a survey of manufacturing supply executives.

Overall, the ISM’s Manufacturing PMI’s reading of 52.8% in both August and July was the lowest level since its 52.4% reading in June 2020. Readings above 50% indicate expansion in the US manufacturing sector.

August’s reading also indicates expansion in the overall economy for the 27th month in a row after contracting in April and May 2020, said Timothy Fiore, chair of the ISM’s Manufacturing Business Survey Committee. 

Respondents noted price expansion eased dramatically; however, they continued to express unease about a softening economy.

Employment was a bright spot.

“According to Business Survey Committee respondents’ comments, companies continued to hire at strong rates in August, with few indications of layoffs, hiring freezes or head-count reductions through attrition,” Fiore said. “Panelists reported lower rates of quits, a positive trend.”

The measure of employment in the report returned to expansion in August after three months of contractions. It was at a reading of 54.2% in August, up from 49.9% in July. Readings above 50.5% over time is generally consistent with an increase in US Bureau of Labor Statistics data on manufacturing employment.