Economic activity in the manufacturing sector expanded in March for the 94th consecutive month, according to The Institute for Supply Management on Monday.
The index hit 57.2, a decrease of 0.5 percentage point from the February reading of 57.7 percent, the group said.
Economist expected the U.S. manufacturing index to hit 57 in March, according to a Thomson Reuters consensus estimate.
A reading above 50 percent indicates that the manufacturing economy is generally expanding; below 50 percent indicates that it is generally contracting.
Of the 18 manufacturing industries included in the survey, 17 reported growth in March, such as electrical equipment, appliances and components, and printing and related support activities, the group said.
The new orders index, which includes companies in apparel, chemical products, paper products and more, registered 64.5 percent, a decrease of 0.6 percentage point from the February reading of 65.1 percent.
U.S. construction spending
Elsewhere, the Commerce Department announced February U.S. construction spending increased 0.8 percentage points, its highest level since April 2006, after falling 1 percent in January. Economists expected spending to grow by 1.1 percent for February, according to Reuters estimates.
U.S. developers ramped up construction spending in February to the largest amount in nearly 11 years, led by more building of homes, highways and schools.
Builders are rapidly putting up more homes in response to strong demand that has pushed up prices for existing homes. Yet it hasn't yet been enough to relieve a shortage of homes for sale. The accelerated building could boost the economy this year.
State and local governments spent 0.9 percent more on construction, driven by roads, schools and recreational buildings.
The federal government, meanwhile, cut construction spending for the second straight month and has cut back 9 percent from a year ago.
— The Associated Press contributed to this report.