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Industrial Production Powers Broad Manufacturing Recovery in May

Manufacturing's rebound has shifted into a higher gear, with industrial production — not consumer demand — now driving freight growth. The ISM Manufacturing PMI climbed to 54.3 in May, marking the highest reading since May 2022 and the fifth consecutive month above the 50-point expansion threshold. The expansion shows genuine breadth: all six largest manufacturing sectors grew, with 16 of 18 industries reporting expansion. Manufacturers are absorbing demand gains through existing capacity, expanding output for seven consecutive months while maintaining flat headcount — a pattern typical of early-stage industrial recoveries before hiring accelerates. Input cost pressures persist but are stabilizing. Steel has remained on the price-increase list for seven straight months, reflecting strong demand conditions and producer pricing power.