ISM: U.S. Services Sector Growth Continues in February
Economic activity in the non-manufacturing sector grew in February for the 26th consecutive month, according to the Institute for Supply Management’s (ISM) latest Report on Business Non-Manufacturing Index (NMI).
“The NMI registered 57.3% in February, 0.5 percentage point higher than the 56.8% registered in January, and indicating continued growth at a faster rate in the non-manufacturing sector, said Anthony Nieves, chair of the ISM Non-Manufacturing Business Survey Committee.
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 registered 62.6%, which is 3.1 percentage points higher than the 59.5% reported in January, reflecting growth for the 31st consecutive month. The New Orders Index increased by 1.8 percentage points to 61.2%, and the Employment Index decreased by 1.7 percentage points to 55.7%, indicating continued growth in employment, but at a slower rate.
The Prices Index increased 4.9 percentage points to 68.4%, indicating prices increased at a faster rate in February when compared to January. According to the NMI, 14 non-manufacturing industries reported growth in February. The majority of comments from the respondents reflect a growing level of optimism about business conditions and the overall economy. There is a concern about inflation, rising fuel prices and petroleum-based product costs.
The 14 non-manufacturing industries reporting growth in February – listed in order – are: Real Estate, Rental & Leasing; Educational Services; Wholesale Trade; Other Services; Transportation & Warehousing; Finance & Insurance; Construction; Arts, Entertainment & Recreation; Public Administration; Accommodation & Food Services; Utilities; Professional, Scientific & Technical Services; Mining; and Information. The three industries reporting contraction in February are: Management of Companies & Support Services; Retail Trade; and Healthcare & Social Assistance.
To read the full ISM report, click here.