ISM: Economic Activity in Hospital Subsector Grows in May Despite Slight Dip in PMI



Economic activity in the hospital subsector grew in May for the 12th consecutive month, according to the latest Hospital ISM Report on Business from the Institute for Supply Management.

“The Hospital PMI registered 61.3% in May, down 0.6 percentage point from the April reading of 61.9%, indicating a 12th consecutive month of growth,” Nancy LeMaster, MBA, chair of the Institute for Supply Management’s hospital business survey committee, said. “The Business Activity Index decreased in May compared to April. The New Orders Index saw a slight increase in May, while the Employment Index moved into contraction. The Days Payable Outstanding Index decreased to 50.5%, down 6.5 percentage points from the April reading of 57%. The Technology Spend Index registered 48.5%, a decrease of 6.5 percentage points from the April reading of 55%.

“In May, hospitals continued to see growth driven by an increase in outpatient and elective procedures.  There was only one reference to a localized increase in coronavirus (COVID-19) patients. Business Survey Committee panelists commented on the continuing challenges with obtaining supplies. Many indicated they are still impacted by port congestion and are dealing with product substitutions. Although some panelists indicated better availability of personal protective equipment (PPE), however, there were comments on shortages and delays related to the global semiconductors manufacturing backlog. Employment contracted this month, and comments from panelists included ‘more open positions due to retirements,’ ‘harder to get employees,’ and ‘trying to replace temporary staff with permanent staff.’ Panelists also indicated they are continuing to burn off excess inventories and looking at reducing discretionary spending to improve profitability.”

Hospital PMI History

Month Hospital PMI Month Hospital PMI
May 2021 61.3 Nov. 2020 62.6
April 2021 61.9 Oct. 2020 63.0
March 2021 58.8 Sept. 2020 63.3
Feb. 2021 57.5 Aug. 2020 63.8
Jan. 2021 55.8 July 2020 68.9
Dec. 2020 62.6 June 2020 63.6
Average for 12 months – 61.9

High – 68.9

Low – 55.8

 


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