Manufacturing is booming — so why isn't anyone getting hired?

The May ISM Manufacturing PMI just printed at 54.0 — strongest in four years. New orders, production, and backlogs all accelerating. On the surface, this looks like a genuine recovery in the factory sector.

But the Prices Paid index came in at 82.1. That's the second-highest reading since April 2022, and not a single industry reported paying less for raw materials. Meanwhile, manufacturing employment is still contracting (48.6). And 42 percent of survey respondents specifically cited the Iran war as hitting their business — a brand-new cost shock that wasn't in the picture six months ago.

So you've got: output expanding, prices near record highs, hiring still negative, and a new geopolitical wildcard. That's not a clean expansion signal. It's closer to a stagflationary squeeze where growth looks fine until the cost structure catches up with it.

I built Recession Tracker (iOS) to follow exactly these kinds of divergences — cases where one indicator flashes green while three others flash yellow. The ISM data is one of eight recession indicators we track in real time, translated into plain English so you don't have to decode it yourself.

Curious how other founders here are reading this — do you see the manufacturing print as genuinely bullish, or does the price/employment split worry you?