Inland Empire PMI Report on Business Amidst Challenging Conditions

By: Sharjeel Sohaib


Jun 9, 2023


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  • The latest Inland Empire Report on Business reveals a modest improvement in the Purchasing Managers’ Index (PMI) for May 2023. Still, caution is advised due to the region’s overall downward trend in recent months.
  • Manufacturing activity slowed, and the Employment Index increased, indicating positive job creation.Β 
  • Businesses in the Inland Empire continue to face supply chain challenges, cost pressures, and concerns about political uncertainties and the overall economy.

The latest report from the Institute of Applied Research and Policy Analysis at the CSUSB Jack H. Brown College of Business and Public Administration provides valuable insights into the state of the economy in the Inland Empire region. 

The report highlights the Purchasing Managers’ Index (PMI), key components such as the Production and New Orders Indices, employment trends, inflation, supply chain challenges, and overall concerns voiced by business leaders. Additionally, analyzing the implications and potential future trends has become crucial as the region navigates through ongoing challenges.

PMI and Subcomponents

The PMI for May 2023 showed a modest improvement, registering 50.0 compared to the previous month’s 46.9. However, caution is advised since the region has witnessed a downward trend in recent months. Two more months at or above the baseline have become necessary to help establish a new course of stability. 

The Production Index experienced a notable decrease from 50.0 to 47.9, indicating a slowdown in manufacturing activity. Similarly, the New Orders Index improved slightly to 43.8, but it has remained below 50 for the past 12 months, signaling a decline in new orders.

Employment and Inflation

While overall manufacturing activity showed signs of moderation, the Employment Index increased to 54.2, indicating a positive trend in job creation. However, concerns regarding finding and retaining skilled employees persist. 

On a positive note, the Commodity Price Index continued its decline, reflecting a decrease in inflation within the region. This drop in prices for imported materials showed mild relaxation to businesses, potentially mitigating cost pressures.

Supply Chain and Inventory

The Supplier Deliveries Index, which measures the speed of supplier deliveries, rose from 48.1 to 52.1. This rise indicates a slowdown in supply deliveries, which can pose challenges for businesses. The Inventory level increased to 52.1, suggesting a build-up of units, but 70.8% of respondents reported that their finished goods inventory remained unchanged. Only a minute percentage reported an increase, while others observed a decrease. Therefore, achieving a balance between production and sales remains a top priority for businesses in the region.

Business Outlook and Concerns

Optimism about the near-future state of the economy continued to decline, with no panelists believing it will be stronger in the coming quarter. Over half of the panelists expressed concerns about a weaker local economy, while the remaining 45% expect the economy to stay the same. The panelists’ remarks highlighted worries about slowing business, supply chain issues, cost control, political factors, and the overall economy.


The Inland Empire’s latest Report on Business underscores the challenges in the region’s economy. While some indicators show slight improvements, caution remains necessary due to the persistent downward trends in various sectors. Businesses continue to grapple with supply chain disruptions and inflation impact. Moreover, concerns regarding political uncertainties and the overall economic climate contribute to the prevailing caution among business leaders.

As the region moves forward, it will become essential to take proactive measures to address supply chain challenges, attract skilled talent, and adapt to changing market conditions. Additionally, policymakers and stakeholders must work together to create an environment conducive to business growth and investment. The Inland Empire can make informed decisions to resolve the current challenges and pursue a path of stability and growth by monitoring and analyzing economic indicators.


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