ISM: Services Sector Activity Slows in September
The Institute for Supply Management said its Non-Manufacturing Index (NMI) registered 54.4% in September, 4.2 percentage points lower than August’s reading of 58.6%. This indicates continued growth at a slower rate in the non-manufacturing sector.
A reading above 50% indicates the non-manufacturing sector economy is generally expanding; below 50% indicates the non-manufacturing sector is generally contracting.
The Non-Manufacturing Business Activity Index decreased to 55.1%, which is 7.1 percentage points lower than the 62.2% reported in August, reflecting growth for the 50th consecutive month but at a significantly slower rate.
The New Orders Index decreased by 0.9 percentage point to 59.6%, and the Employment Index decreased 4.3 percentage points to 52.7%, indicating growth in employment for the 14th consecutive month. The Prices Index increased 3.8 percentage points to 57.2%, indicating prices increased at a faster rate in September when compared to August.
According to the NMI, 11 non-manufacturing industries reported growth in September. The majority of the respondents’ comments continue to be positive; however, there is an increase in the degree of uncertainty regarding the future business climate and the direction of the economy, the ISM said.
The 11 non-manufacturing industries reporting growth in September — listed in order — are: Retail Trade; Management of Companies & Support Services; Transportation & Warehousing; Construction; Utilities; Information; Finance & Insurance; Other Services; Wholesale Trade; Professional, Scientific & Technical Services; and Public Administration.
The four industries reporting contraction in September are: Arts, Entertainment & Recreation; Educational Services; Health Care & Social Assistance; and Mining.
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