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ISM: Services Sector Continues Growth Trend in July

August 06, 2013, 06:55 AM
Filed Under: Economy

Economic activity in the non-manufacturing sector grew in July for the 43rd consecutive month, say the nation's purchasing and supply executives in the latest Non-Manufacturing ISM Report On Business.
The report was issued today by Anthony Nieves, C.P.M., CFPM, chair of the Institute for Supply Management™ Non-Manufacturing Business Survey Committee. "The NMI™ registered 56 percent in July, 3.8 percentage points higher than the 52.2 percent registered in June. This indicates continued growth at a faster rate in the non-manufacturing sector. The Non-Manufacturing Business Activity Index increased substantially to 60.4 percent, which is 8.7 percentage points higher than the 51.7 percent reported in June, reflecting growth for the 48th consecutive month. The New Orders Index increased significantly by 6.9 percentage points to 57.7 percent, and the Employment Index decreased 1.5 percentage points to 53.2 percent, indicating growth in employment for the 12th consecutive month. The Prices Index increased 7.6 percentage points to 60.1 percent, indicating prices increased at a significantly faster rate in July when compared to June. According to the NMI™, 16 non-manufacturing industries reported growth in July. Respondents' comments are mostly positive about business conditions and the overall economy."
Industry Performance

The 16 non-manufacturing industries reporting growth in July — listed in order — are: Arts, Entertainment & Recreation; Construction; Information; Wholesale Trade; Retail Trade; Finance & Insurance; Real Estate, Rental & Leasing; Agriculture, Forestry, Fishing & Hunting; Utilities; Educational Services; Other Services; Management of Companies & Support Services; Professional, Scientific & Technical Services; Accommodation & Food Services; Public Administration; and Transportation & Warehousing.

The two industries reporting contraction in July are: Mining; and Health Care & Social Assistance.
What respondents are saying:

  •  "The economy seems to be getting stronger with commodity prices increasing." (Information)
  •  "Sequestration and healthcare reform causing uncertainty and lower revenues." (Health Care & Social Assistance)
  •  "Business orders continue to grow, but at a slow pace. We are seeing growth in areas where we have been flat for many months. Economy seems to be stabilizing in some areas and heating up in others." (Professional, Scientific & Technical Services)
  •  "The auto industry continues to be strong, and we expect it to continue throughout 2013." (Retail Trade)
  •  "Competitive environment remains challenging." (Accommodation & Food Services)
  •  "Local business continues at same pace as last year. Capital investment continues to be positive." (Wholesale Trade)

To read the full July Non-Manufacturing ISM Report On Business, click here.

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