Financial information firm Markit said its U.S. "flash" manufacturing Purchasing Managers Index for July fell to 51.8 from 52.5 in June. July marked the fourth consecutive month of slower growth and the sector's weakest showing since December, 2010.
The index remained above 50, indicating factory activity continued to expand, only less rapidly.
New orders for exports fell outright for the second straight month, the first back-to-back decline in nearly three years, Markit said, as recession in Europe dented demand.
"The U.S. manufacturing sector is clearly struggling under the pressure from falling exports," said Chris Williamson, chief economist at Markit. "Reassuringly, domestic demand appears to be showing ongoing signs of resilience, encouraging firms to take on more staff."
