Economic activity in the U.S. manufacturing sector fell in September to its lowest level since October 2001, the Institute for Supply Management (ISM) reported today.

The ISM's key purchasing managers' index for manufacturing, released today, registered 43.5 in September, down from 49.9 in August. Readings of more than 50 indicate expansion.

"The [key purchasing managers' index] indicates a significantly faster rate of decline in manufacturing during September," said Norbert Ore, chair of the institute's manufacturing business survey committee. "This is the lowest level for the [index] since October 2001."

September's contraction was more than anticipated. The Wall Street Journal reported the index was only expected to drop to 49.5.

In addition, the employment portion of the index fell to 41.8 in September from 49.7 in August.