Activity in the US manufacturing sector expanded in November, but labor remains a challenge, according to the Institute for Supply Management’s “Manufacturing ISM Report on Business,” released today.

“The US manufacturing sector remains in a demand-driven, supply chain-constrained environment, with some indications of slight labor and supplier delivery improvement,” said Timothy Fiore, chair of the ISM’s manufacturing business survey committee.

Meeting demand remains an issue due in part to hiring difficulties, according to the report. One respondent at a fabricated metal products firm noted finding qualified workers remains the biggest challenge.

However, Fiore noted 7% of respondents in November indicated improvements regarding employment compared to 5% in October. In addition, he said a majority of manufacturers, 86%, said their companies are hiring or attempting to hire.

Overall, the ISM’s Manufacturing PMI measure of activity in the US manufacturing sector rose to a reading of 61.1% in November from 60.8% in October, indicating expansion at a faster rate. A reading above 50% indicates the manufacturing economy is generally expanding. A Manufacturing PMI above 43.1% over time generally indicates an expansion of the overall economy.

The employment subindex of the Manufacturing PMI rose to a level of 53.3% in November from 52.0% in October, indicating an expansion in employment.