The Partnership sends updates for the most important economic indicators each month. If you would like to opt-in to receive these updates, please click here.

Estimated Read Time: 1 minute

Houston’s economy continued to expand in April, but not as rapidly as in March, according to the most recent Houston Purchasing Managers Index (PMI) prepared by the Institute for Supply Management-Houston. Manufacturing contracted, but more slowly. Non-manufacturing activity expanded, but not as fast.

The overall PMI slipped 0.2 points from 50.5 in March to 50.3 in April. Readings above 50 indicate overall expansion in Houston’s economy, below 50, contraction. Houston’s Manufacturing PMI rose from 45.9 to 49.2. The Non-manufacturing PMI slipped from 51.4 to 50.5.

Regarding the two major subcomponents: 

• Houston’s Manufacturing PMI slipped 9.5 points to 45.9, indicating contraction. It has tracked below 50 for 12 of the past 18 months. 
• The Non-Manufacturing PMI slipped from 53.3 to 51.4. It has tracked above 50 for all but one month since August ’20.

Two of three indicators with a strong positive correlation with economic activity, Sales/New Orders and Lead Times saw expansion while Employment signaled contraction.

Two of the three indicators with a strong positive correlation with economic activity, Lead Times and Employment, saw contraction while Sales/New Orders signaled expansion.

• Sales/New Orders rose from 52.2 to 54.1. 
• Lead Times slipped from 51.6 to 48.4.
• Employment slipped from 49.7 to 48.1. 

The finished goods inventory index, the underlying indicator that has the strongest inverse correlation with economic activity, slipped to 48.8, suggesting expansion.

On an industry-specific basis, business and technical services, utilities, health care, and nondurable goods manufacturing reported strong expansion. Oil and gas and durable goods manufacturing showed relative weakness.

The PMI is published monthly by the Institute for Supply Management – Houston and is based on a survey of supply chain executives in the region. For additional information, click here.

Prepared by Greater Houston Partnership Research

Patrick Jankowski, CERP
Chief Economist
Senior Vice President, Research
pjankowski@houston.org

Leta Wauson
Research Director
Greater Houston Partnership
lwauson@houston.org