A flash estimate of the country's Purchasing Managers' Index shows a modest improvement in business conditions in April, Markit said. On the other hand, new orders growth slowed sharply and the rise in manufacturing output was the weakest in five months, the research firm said.
Markit Economics said the headline PMI fell from 54.6 in March to 52 in April, the lowest reading in six months.
Levels above 50 indicate growth, while below 50 indicates contraction. As such, even though it was not as strong as the previous month, a reading of 52 shows "moderate improvement in overall manufacturing business conditions," Markit said.
Markit's index for new orders fell from 55.4 to 51.8. The index for new export orders rose from 51.8 to 52.2.
The employment index slipped from 54.6 to 52.7.
"The biggest monthly fall in the PMI since June 2010 raises concerns that the U.S. manufacturing expansion is losing momentum rapidly as businesses and households worry about the impact of tax hikes and government spending cuts," Markit Chief Economist Chris Williamson said in a statement.
"The PMI suggests that output growth has slowed from an annual pace approaching 8 percent earlier in the year to only 2 percent at the start of the second quarter," he said.
Obama 'selfie' photographer speaks out: 'Photos can lie'
Wisconsin business offering 'therapeutic cuddling' forced to close