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ISM Non-Manufacturing Index increased to 58.1% in July
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Economic activity in the Services sector (formally non-manufacturing sector) grew in July for the second month in a row, say the nation's purchasing and supply executives in the latest Services ISM® Report On Business®.
The report was issued today by Anthony Nieves, CPSM, C.P.M., A.P.P., CFPM, Chair of the Institute for Supply Management® (ISM®) Services Business Survey Committee: “The Services PMI™ registered 58.1 percent, 1 percentage point higher than the June reading of 57.1 percent. This reading represents growth in the services sector for the second straight month after contraction in April and May, preceded by a 122-month period of expansion.
“The Supplier Deliveries Index registered 55.2 percent, down 2.3 percentage points from June’s reading of 57.5 percent. Supplier Deliveries is the only ISM® Report On Business® index that is inversed; a reading of above 50 percent indicates slower deliveries, which is typical as the economy improves and customer demand increases. The higher readings for supplier deliveries in the three months prior to June were primarily a product of supply problems related to the coronavirus (COVID-19) pandemic. Supplier deliveries are now more closely correlating to the current supply and demand.
“The Prices Index figure of 57.6 percent is 4.8 percentage points lower than the June reading of 62.4 percent, indicating that prices increased in July at a slower rate. According to the Services PMI™, 15 services industries reported growth. The composite index indicated growth for the second consecutive month after two months of contraction. The sector’s previous period of contraction was for two months in 2009: November (with a Services PMI™ of 49.5 percent) and December (with a Services PMI™ of 49.7 percent). Respondents remain concerned about the pandemic; however, they are mostly optimistic about business conditions and the economy as businesses continue to reopen. Sentiment varies across industries, as they are impacted differently,” says Nieves.
INDUSTRY PERFORMANCE
The 15 services industries reporting growth in July — listed in order — are: Arts, Entertainment & Recreation; Health Care & Social Assistance; Retail Trade; Transportation & Warehousing; Wholesale Trade; Educational Services; Construction; Utilities; Public Administration; Finance & Insurance; Management of Companies & Support Services; Real Estate, Rental & Leasing; Agriculture, Forestry, Fishing & Hunting; Accommodation & Food Services; and Information. The three industries reporting a decrease in July are: Other Services; Mining; and Professional, Scientific & Technical Services.
Posted: August 5, 2020 Wednesday 10:00 AM