U.S. Manufacturing Surges to Fastest Pace Since 2022

Factories expand despite soaring input costs from Middle East conflict

Apr. 1, 2026 at 7:57pm

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American manufacturing activity accelerated to its highest level in nearly four years in March, with new orders, production, and backlogs all expanding despite a war-driven surge in input costs, according to two closely watched industry surveys.

Why it matters

The resilience of U.S. manufacturing in the face of spiking energy prices and supply chain disruptions signals the sector's ability to withstand economic shocks, though persistent labor shortages remain a concern.

The details

The Institute for Supply Management's Manufacturing PMI registered 52.7 in March, up from 52.4 in February, marking the third consecutive month of expansion and the strongest reading since 2022. The S&P Global US Manufacturing PMI also rose, extending its own expansion streak to eight months. The surveys found growth was 'principally driven by higher domestic demand,' with new orders, production, and backlogs all accelerating.

  • The March manufacturing data was released on April 1, 2026.
  • The last time the ISM Manufacturing PMI reached this level was in 2022.

The players

Institute for Supply Management

A trade group that conducts a monthly survey of the manufacturing sector.

S&P Global

A financial data and analytics firm that also publishes a monthly manufacturing survey.

Jerome Powell

Chair of the Federal Reserve, who commented on the outlook for energy prices and monetary policy.

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What they’re saying

“Energy shocks have tended to come and go pretty quickly.”

— Jerome Powell, Federal Reserve Chair

“The data pointed to 'encouraging resilience for US manufacturing in the face of the outbreak of war in the Middle East,' adding that business confidence 'also indicates that producers anticipate only a short-term and modest impact from the war, which is clearly uncertain.'”

— Chris Williamson, Chief Business Economist, S&P Global Market Intelligence

What’s next

The Bureau of Labor Statistics will release the March jobs report on Friday, which will provide further insight into the state of the manufacturing labor market.

The takeaway

Despite soaring input costs driven by the Middle East conflict, U.S. manufacturing has demonstrated remarkable resilience, with new orders, production, and backlogs all accelerating. This signals the sector's ability to withstand economic shocks, though persistent labor shortages remain a concern.