Manufacturing activity for September stayed strong while the overall economy grew for the 35th consecutive month, according to the most recent Manufacturing ISM Report on Business.

Norbert Ore, chairman of ISM's Manufacturing Business Survey Committee and group director, strategic sourcing and procurement, Georgia-Pacific Corp., was cheered by the findings, saying in a statement that "the manufacturing sector continued to grow during September…. [And] both new orders and production remain strong, while employment growth accelerated."

ISM's report also found that the overall manufacturing economy grew in September for the 16th consecutive month. The Report on Business is based on data compiled from monthly replies to questions asked of purchasing and supply executives in more than 400 industrial companies.

Other positives that ISM pointed to include its New Orders Index reading of 58.1 percent—the 17th consecutive month the index has exceeded 50 percent. Among the industries that reported increases for September were: glass, stone and aggregate; rubber and plastic products; industrial and commercial equipment; computers; chemicals; food; transportation and equipment; and wood products.

ISM's Production Index was at 61.6 percent, up 2.1 percentage points from August. September marked the 17th consecutive month of growth in this index.

However, the ISM report also showed there is ongoing pressure on manufacturers to raise prices. Its Customers' Inventories Index reflected that customer inventories are too low, with a reading of 41.5 percent, a decrease of four percentage points from August. This is the 40th consecutive month that the index has registered below 50 percent.

In addition, ISM's Prices Index showed that manufacturers continued to pay higher prices in September—the 31st consecutive month the index has registered higher prices. During September, 55 percent of supply executives reported paying higher prices, with only 3 percent reporting they paid lower prices. Forty-two percent reported that prices were unchanged from the preceding month.

Elsewhere, a report released by the U.S. Department of Commerce showed that construction spending reached a record high this past August.

In the Commerce Department's report, residential building rose by 1.7 percent in August to a high of $550.6 billion (on an annualized basis). Meanwhile, commercial construction increased by 0.8 percent to an annual rate of $227 billion. This is the highest for commercial construction since June, 2002.

Despite this being an election year, the Department of Commerce indicated that government spending on large public works construction actually fell by 1 percent to an annual rate of $237.6 billion.