WASHINGTON, (Reuters) – U.S. manufacturing activity increased in September. However, factories had longer delays receiving raw materials and were charged higher input prices.

On Friday, the Institute for Supply Management (ISM), reported that its index of national manufacturing activity rose to 61.1 from 59.9 in August.

An index reading higher than 50 means that there has been an increase in the manufacturing sector, which is responsible for about 12% of America’s economy. Reuters polled economists to forecast that the index will fall to 59.6.

The surprise increase in ISM was partly due to an increase in survey supplier deliveries, which reached 73.4 in September from 69.5 in August.

If the reading is higher than 50 percent, it means slower delivery. But, an increase in suppliers’ delivery times usually indicates a strong economy. This would also be associated with increased customer demand and a better contribution to ISM index. Slower supplier deliveries are indicative of persistent supply problems related to COVID-19.

This was reflected in a rise in survey prices paid by manufacturers, which rose to 81.2 in August from an august low of 79.4 (eight months ago). Last week, the Federal Reserve raised its inflation projection to 3.7%. This was an increase from the June median projection of 3.0%. Flexible inflation targets of 2% are set by the U.S. Central Bank.

Apart from the technical boost from supplier deliveries, manufacturing is robust.

In the ISM survey, the forward-looking new order sub-index was at 66.7 in last month. Manufacturers are being supported by companies that want to rebuild stock after depleting inventories during the first half.

In September, the survey’s measurement of customer inventories was still in contraction.

After falling to its lowest point since November, a gauge measuring factory employment saw a rebound last month. That means that the growth in manufacturing payrolls has likely picked up in September following a slowdown in August.

Next Friday, the Labor Department will release its highly anticipated employment report.