Institute for Supply Management (ISM)

Written By
Paul Tracy
Updated November 11, 2020

What is the Institute for Supply Management (ISM)?

The Institute for Supply Management (ISM) is a professional association for individuals and companies with an interest in supply management.

How Does the Institute for Supply Management (ISM) Work?

The ISM publishes two important monthly surveys, the Manufacturing ISM Report on Business and the Non-Manufacturing ISM Report on Business

Both the Manufacturing and Non-Manufacturing ISM Reports include surveys of purchasing and supply executives around the country on topics such as the number of new orders they're placing, production levels, hiring/employment, supplier deliveries, inventories, prices, order backlogs, exports and imports.  

The reports also include direct quotations from executives on the state of their businesses. For example, in June 2012, respondents were saying:

"General state of business this month is flat, with no changes." (Construction industry)

"Business is still growing, but there has been a definite slowing in growth." (Wholesale Trade)

"Business is still strong, with some nagging question whether it will be sustained." (Machinery)

Why Does the Institute for Supply Management (ISM) Matter?

The ISM releases its reports every month. The results of its survey can be immediately felt throughout the markets. 

The most closely-watch component of the monthly reports is the Purchasing Managers Index (PMI). The PMI is widely regarded as an important and accurate predictor of the broad economy. A number above 50 suggests that the economy is expanding, while a reading below 50 suggests it is contracting. 

Ask an Expert
All of our content is verified for accuracy by Paul Tracy and our team of certified financial experts. We pride ourselves on quality, research, and transparency, and we value your feedback. Below you'll find answers to some of the most common reader questions about Institute for Supply Management (ISM).
Be the first to ask a question

If you have a question about Institute for Supply Management (ISM), then please ask Paul.

Ask a question

Paul has been a respected figure in the financial markets for more than two decades. Prior to starting InvestingAnswers, Paul founded and managed one of the most influential investment research firms in America, with more than 2 million monthly readers.

If you have a question about Institute for Supply Management (ISM), then please ask Paul.

Ask a question Read more from Paul

Read this next

Paul Tracy - profile
Ask an Expert about Institute for Supply Management (ISM)

By submitting this form you agree with our Privacy Policy

Don't Know a Financial Term?
Search our library of 4,000+ terms