The Hospital PMI® for May 2025 reveals that economic activity in the hospital sector continues to expand for the 21st month straight. Although there was a slight decline, the numbers show ongoing strength in supply management and hospital operations across the United States.
Hospital PMI® Shows Continued Growth Amid May 2025 Slowdown
The Hospital PMI® registered 52 percent in May, a decrease of 3 points from April’s 55 percent. Still, any reading above 50 percent indicates expansion, highlighting ongoing resilience in the sector. The New Orders Index was unchanged, while both the Business Activity and Employment Indexes stayed in expansion territory. Despite the dip, industry leaders remain optimistic about the hospital subsector’s growth prospects.
Key Drivers Shaping Hospital Sector Expansion and Challenges
Several factors are affecting the pace of hospital sector growth. Tariffs remain a significant concern for supply executives, leading some hospitals to increase supply purchases. Others are waiting to see how tariff policies play out. Group purchasing agreements have helped control some costs, but certain facilities are beginning to see price increases. Employment trends are mixed, with some hospitals hiring for clinical roles while others plan head-count reductions.
What the Latest Hospital PMI® Means for Healthcare Industry
The latest report offers valuable insights for industry stakeholders. Increases in technology spending and touchless orders signal ongoing innovation and adaptation. The Case Mix Index and Days Payable Outstanding Index both returned to expansion territory, pointing to operational confidence. Inventory levels are rising as hospitals prepare for possible tariff impacts, while concerns about supplier deliveries and shortages remain limited.
In summary, the May 2025 Hospital PMI® shows the hospital sector is maintaining its momentum, even as headwinds like tariffs and inventory adjustments arise. With a strong focus on technology and adaptive purchasing strategies, hospitals appear well-equipped to handle future challenges and drive continued expansion in the months ahead.
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