The flash estimate of the Purchasing Managers Index for U.S. manufacturing in October dropped to 51.1, showing slight growth, as numbers above 50 indicate expansion.
But the PMI estimate, based on 85 percent of the data for the month, came in at a 12-month low, "signalling only modest manufacturing growth," Markit Economics said in a monthly report.
"The flash PMI provides the first insight into how business fared against the backdrop of the [16-day partial] government shutdown in October, and suggests that the disruptions and uncertainty caused by the crisis hit companies hard," said Chief Economist Chris WIlliamson.
"The survey showed the first fall in manufacturing output since the height of the global financial crisis back in September 2009. We can expect GDP growth to have suffered a set-back in the fourth quarter, but it is too early to estimate the extent of the slowdown. It is impossible to disentangle the impact of the shutdown from other factors that might have been at play during the month," he said.
The data for October showed the output index dropping from 55.3 to 49.5, indicating a slight contraction in production. The critical new orders index dropped from 53.2 to 51.6.
New export orders picked up the pace with a flash estimate at 50.7, up from 49 in September. The backlog of work index was estimated at 50.5 in October, up from 50.2, Markit said.