Hospital PMI® at 59.8%; November 2023 Hospital ISM® Report On Business®

TEMPE, Ariz., Dec. 7, 2023 /PRNewswire/ -- Economic activity in the hospital subsector grew in November for the third consecutive month after contracting twice in a four-month period, with 35 consecutive months of growth prior to that, say the nation's hospital supply executives in the latest Hospital ISM^® Report On Business^®.

The report was issued today by Nancy LeMaster, MBA, Chair of the Institute for Supply Management^® (ISM^®) Hospital Business Survey Committee: "The Hospital PMI^® registered 59.8 percent in November, a 7.7-percentage point increase from the October reading of 52.1 percent, indicating a third consecutive month of growth after a contraction in August. The Business Activity Index expanded for the third consecutive month. The New Orders Index remained in expansion for the third straight month, and the Employment Index returned to expansion territory. The Supplier Deliveries Index remained in expansion, which indicates slower delivery performance. The Case Mix Index remained in expansion territory, registering 54 percent, an increase of 2.5 percentage points compared to the October figure of 51.5 percent. The Days Payable Outstanding Index expanded for the second consecutive month at 52.5 percent, up 1 percentage point from the 51.5 percent reported in October. The Technology Spend Index reading of 57 percent is an increase of 1.5 percentage points compared to the 55.5 percent recorded in October. The Touchless Orders Index registered 51.5 percent, the same reading as reported in October."

LeMaster continues, "Hospital Business Survey Committee respondents attributed volume growth in November to an increase in elective procedures and seasonal respiratory cases. Several panelists indicated success in hiring additional staff during the month but remained cautious regarding the competitive labor market. Inflation and increasing costs are still putting pressure on hospital margins, which resulted in continuing cost-cutting measures. Back orders and shortages lingered, but panelists' comments in general suggested a slow, steady increase in supplier delivery performance."

About This Report
The information compiled in this report is for the month of November 2023.

The Hospital PMI^® was developed in collaboration with the Association for Health Care Resource & Materials Management (AHRMM), an association for the health care supply chain profession, and a professional membership group of the American Hospital Association (AHA).

The data presented herein is obtained from a survey of hospital supply executives based on information they have collected within their respective organizations. ISM^® makes no representation, other than that stated within this release, regarding the individual company data collection procedures. The data should be compared to all other economic data sources when used in decision-making.

Data and Method of Presentation
The Hospital ISM^® Report On Business^® is based on data compiled from hospital purchasing and supply executives nationwide. Survey responses reflect the change, if any, in the current month compared to the previous month. For each of the indicators measured (Business Activity, New Orders, Employment, Supplier Deliveries, Inventories, Prices, Prices: Pharmaceuticals, Prices: Supplies, Backlog of Orders, Imports, Inventory Sentiment, Case Mix, Days Payable Outstanding, Technology Spend, and Touchless Orders), this report shows the percentage reporting each response and the diffusion index. Responses represent raw data and are never changed. Beginning in January 2021, the Report On Business^® staff and consultants are gathering market information to better validate the Exports Index. Exports Index data are still being collected.

The Hospital PMI^® is a composite index computed from the following, equally weighted indexes: Business Activity, New Orders, Employment and Supplier Deliveries. Diffusion indexes have the properties of leading indicators and are convenient summary measures showing the prevailing direction of change and the scope of change. A Hospital PMI^® index reading above 50 percent indicates that the hospital sub-sector is generally expanding; below 50 percent indicates that it is generally declining. For the sub-indexes, except Supplier Deliveries, an index reading above 50 percent indicates that the sub-index is generally expanding; below 50 percent indicates that it is generally contracting. A Supplier Deliveries Index above 50 percent indicates slower deliveries and below 50 percent indicates faster deliveries.

The Hospital ISM^® Report On Business^® survey is sent out to the Hospital Business Survey Committee respondents the first part of each month. Respondents are asked to ONLY report on U.S. operations for the current month. ISM^® receives survey responses throughout most of any given month, with the majority of respondents generally waiting until late in the month to submit responses to give the most accurate picture of current business activity. ISM^® then compiles the report for release on the fifth business day of the following month.

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About Institute for Supply Management^®
Institute for Supply Management^® (ISM^®) is the first and leading not-for-profit professional supply management organization worldwide. Its community of more than 50,000 in more than 100 countries manage about US$1 trillion in corporate and government supply chain procurement annually. Founded in 1915 by practitioners, ISM is committed to advancing the practice of supply management to drive value and competitive advantage for its members, contributing to a prosperous and sustainable world. ISM empowers and leads the profession through the ISM^® Report On Business^®, its highly-regarded certification and training programs, corporate services, events, and assessments. The ISM^® Report On Business^®, Manufacturing, Services, and Hospital, are three of the most reliable economic indicators available, providing guidance to supply management professionals, economists, analysts, and government and business leaders. For more information, please visit: www.ismworld.org.

The text version of the public Hospital ISM^® Report On Business^® is posted on ISM^®'s website at www.ismrob.org on the fifth business day* of every month at 10:00 a.m. ET.

The next Hospital ISM^® Report On Business^® featuring December 2023 data will be released at 10:00 a.m. ET on Tuesday, January 9, 2024.

*Unless the New York Stock Exchange is closed.

SOURCE Institute for Supply Management