Economic activity in the U.S. manufacturing sector in October slid to its lowest level since September 1982, the Institute for Supply Management (ISM) reported.

The ISM's key purchasing managers' index for manufacturing, released today, had a reading of 38.9 in October, down from 43.5 in September as manufacturing activity slowed further. Readings of more than 50 indicate expansion.

"It appears that manufacturing is experiencing significant demand destruction as a result of recent events, with [institute] members indicating challenges associated with the financial crisis, interruptions from the Gulf hurricane and the lagging impact from higher oil prices," said Norbert Ore, chair of the institute's manufacturing business survey committee.

In addition, the employment portion of the index fell to 34.6 in October from 41.8 in September.