A service sector employee sits at his desk. (Photo: REUTERS)
The Non-Manufacturing ISM Report On Business showed service sector growth fell to 55.3 in December from 55.9, far below expectations for a 56 gain. Institute for Supply Management’s gauge of service sector growth is based on data compiled from monthly surveys sent to more than 375 purchasing executives working in the non-manufacturing industries across the country.
Readings above 50 indicate expansion, while those below point to contraction.
“According to the NMI, 11 non-manufacturing industries reported growth in December. Faster deliveries in December contributed to the overall slight slowing in the rate of growth according to the NMI composite index,” said Anthony Nieves, chair of the Institute for Supply Management Non-Manufacturing Business Survey Committee. “All of the other component indexes increased in the month of December. The majority of respondents’ comments remain positive about business conditions and the overall economy.”
The 11 non-manufacturing industries reporting growth in December — listed in order — are: Accommodation & Food Services; Management of Companies & Support Services; Health Care & Social Assistance; Information; Retail Trade; Real Estate, Rental & Leasing; Arts, Entertainment & Recreation; Finance & Insurance; Construction; Professional, Scientific & Technical Services; and Utilities. The five industries reporting contraction in December are: Other Services; Educational Services; Wholesale Trade; Public Administration; and Transportation & Warehousing.
| ISM® NON-MANUFACTURING SURVEY RESULTS AT A GLANCE COMPARISON OF ISM® NON-MANUFACTURING AND ISM® MANUFACTURING SURVEYS* DECEMBER 2015 |
|||||||||
|---|---|---|---|---|---|---|---|---|---|
| Non-Manufacturing | Manufacturing | ||||||||
| Index | Series Index Dec |
Series Index Nov |
Percent Point Change |
Direction | Rate of Change |
Trend** (Months) |
Series Index Dec |
Series Index Nov |
Percent Point Change |
| NMI®/PMI® | 55.3 | 55.9 | -0.6 | Growing | Slower | 71 | 48.2 | 48.6 | -0.4 |
| Business Activity/Production | 58.7 | 58.2 | +0.5 | Growing | Faster | 77 | 49.8 | 49.2 | +0.6 |
| New Orders | 58.2 | 57.5 | +0.7 | Growing | Faster | 77 | 49.2 | 48.9 | +0.3 |
| Employment | 55.7 | 55.0 | +0.7 | Growing | Faster | 22 | 48.1 | 51.3 | -3.2 |
| Supplier Deliveries | 48.5 | 53.0 | -4.5 | Faster | From Slower | 1 | 50.3 | 50.6 | -0.3 |
| Inventories | 53.0 | 54.5 | -1.5 | Growing | Slower | 9 | 43.5 | 43.0 | +0.5 |
| Prices | 49.7 | 50.3 | -0.6 | Decreasing | From Increasing | 1 | 33.5 | 35.5 | -2.0 |
| Backlog of Orders | 50.0 | 51.5 | -1.5 | Unchanged | From Growing | 1 | 41.0 | 43.0 | -2.0 |
| New Export Orders | 53.5 | 49.5 | +4.0 | Growing | From Contracting | 1 | 51.0 | 47.5 | +3.5 |
| Imports | 49.0 | 51.0 | -2.0 | Contracting | From Growing | 1 | 45.5 | 49.0 | -3.5 |
| Inventory Sentiment | 64.5 | 63.5 | +1.0 | Too High | Faster | 223 | N/A | N/A | N/A |
| Customers’ Inventories | N/A | N/A | N/A | N/A | N/A | N/A | 51.5 | 50.5 | +1.0 |
| Overall Economy | Growing | Slower | 77 | ||||||
| Non-Manufacturing Sector | Growing | Slower | 71 | ||||||
* Non-Manufacturing ISM® Report On Business® data is seasonally adjusted for Business Activity, New Orders, Prices and Employment Indexes. Manufacturing ISM® Report On Business® data is seasonally adjusted for New Orders, Production, Employment and Supplier Deliveries.
** Number of months moving in current direction.
