ISM® Makes Annual Adjustments to Seasonal Factors for ISM® Manufacturing PMI® and Diffusion Indexes and ISM® Services PMI® and Diffusion Indexes

(Tempe, Arizona) — Based on input from an independent expert, Institute for Supply Management® (ISM®) recently announced the completion of its annual adjustments to the seasonal factors used in the monthly ISM® Manufacturing PMI® Report On Business® and the monthly Services PMI® Report On Business®. Purchasing managers and economists who track these indexes will note that changes are effective with the January 2023 ISM® Manufacturing PMI®, which is scheduled to be released on February 1, 2023, and the January 2023 ISM® Services PMI®, which will be released on February 3, 2023.

Seasonal adjustment factors are used to allow for the effects of repetitive intra-year variations resulting primarily from normal differences in weather conditions, various institutional arrangements, and differences attributable to non-movable holidays. It is standard practice to project the seasonal adjustment factors used to calculate the indexes one year ahead (2023).

As in previous years, the X-13-ARIMA program was used to develop the revisions to the Manufacturing and Services indexes for January 2020 through December 2022, as well as the 2023 projected seasonal factors. The 2023 seasonal factors will be recomputed when the actual data are known in early 2024. Projected seasonal factors for 2023 are shown below.

2023 Seasonal Adjustment Factors for ISM® Manufacturing Indexes




Jan-2023 0.955 0.933 0.970 1.009
Feb-2023 1.034 1.010 1.005 1.015
Mar-2023 1.075 1.030 1.031 1.013
Apr-2023 1.079 1.071 1.019 1.001
May-2023 1.016 0.987 0.985 0.992
Jun-2023 1.023 1.052 1.031 1.000
Jul-2023 0.972 1.007 1.036 0.983
Aug-2023 1.009 1.007 0.990 1.033
Sep-2023 0.978 0.983 0.967 0.999
Oct-2023 0.978 0.969 1.009 1.027
Nov-2023 0.953 1.021 0.982 0.976
Dec-2023 0.941 0.921 0.976 0.959

To compute the Manufacturing PMI®:

  1. Calculate the unadjusted diffusion index for New Orders, Production, Employment and Inventories to two decimal places (percent higher plus one half of the percent same or unchanged). Supplier Deliveries (which are not seasonally adjusted) is percent slower plus one half of the percent same or unchanged.
  2. Divide each unadjusted diffusion index by its seasonal factor (round to one decimal place).
  3. Add all five index numbers together and divide by five.

To compute other indexes, follow steps #1 and #2 above for each indicator.

2023 Seasonal Adjustment Factors for ISM® Services Indexes

  Business Activity New Orders Employment Prices
Jan-2023 0.887 0.900 0.958 0.970
Feb-2023 0.960 0.988 0.959 0.989
Mar-2023 0.998 1.018 1.023 1.042
Apr-2023 1.096 1.064 1.024 1.058
May-2023 1.015 1.013 1.024 1.058
Jun-2023 1.009 1.027 1.037 1.038
Jul-2023 1.023 1.016 1.014 1.010
Aug-2023 1.000 0.978 0.980 0.975
Sep-2023 1.051 1.077 1.009 0.975
Oct-2023 0.982 0.953 0.983 0.990
Nov-2023 1.016 1.005 0.993 0.967
Dec-2023 0.948 0.943 0.997 0.925

To compute the Services PMI®:

  1. Calculate the unadjusted diffusion index for Business Activity, New Orders and Employment to two decimal places (percent higher or up plus one half of the percent same or unchanged). For Supplier Deliveries, it will be percent slower plus one half of the percent same or unchanged.
  2. Divide each unadjusted diffusion index by its seasonal factor (round to one decimal place).
  3. Add all four index numbers together and divide by four.

To compute other indexes, follow steps #1 and #2 above for each indicator.

Please note that differences in rounding practices may result in computed values that differ from published values.

About ISM® Report On Business®

The ISM® Report On Business® is considered by many economists to be the most reliable near-term economic barometer available. It is reviewed regularly by top government agencies and economic and business leaders for its timely, accurate information. The Manufacturing and Services ISM® Report On Business® is published monthly by Institute for Supply Management®. Each month, both reports are compiled from responses to questions asked of purchasing and supply executives across the country and reflects change, if any, in the current month compared to previous months.

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About Institute for Supply Management®

Institute for Supply Management® (ISM®) serves supply management professionals in more than 90 countries. Its 50,000 members around the world manage about US$1 trillion in corporate and government supply chain procurement annually. Founded in 1915 as the first supply management institute in the world, 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 leads the profession through the ISM Report On Business®, its highly regarded certification programs and the ISM Advance Digital Platform. This report has been issued by the association since 1931, except for a four-year interruption during World War II.