ISM: Services Sector Growth Highest Since Feb ’12
The Institute for Supply Management said its Non-Manufacturing Index (NMI) registered 56% in February, 0.8 percentage point higher than the 55.2% registered in January. This indicates continued growth at a slightly faster 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.
In addition, the ISM said economic activity in the non-manufacturing sector grew in February for the 38th consecutive month.
This month’s reading also reflects the highest NMI since February 2012, when the index registered 56.1%.
The Non-Manufacturing Business Activity Index registered 56.9%, which is 0.5 percentage point higher than the 56.4% reported in January, reflecting growth for the 43rd consecutive month. The New Orders Index increased by 3.8 percentage points to 58.2%, and the Employment Index decreased 0.3 percentage point to 57.2%, indicating growth in employment for the seventh consecutive month. The Prices Index increased 3.7 percentage points to 61.7%, indicating prices increased at a faster rate in February when compared to January.
According to the NMI, 13 non-manufacturing industries reported growth in February. The majority of respondents’ comments reflect a growing optimism about the trend of the economy and overall business conditions.
The 13 non-manufacturing industries reporting growth in February – listed in order – are: Management of Companies & Support Services; Real Estate, Rental & Leasing; Public Administration; Health Care & Social Assistance; Transportation & Warehousing; Wholesale Trade; Educational Services; Construction; Finance & Insurance; Other Services; Retail Trade; Professional, Scientific & Technical Services; and Utilities.
The five industries reporting contraction in February are: Mining; Arts, Entertainment & Recreation; Information; Accommodation & Food Services; and Agriculture, Forestry, Fishing & Hunting.
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