Economy

ISM Report on Business: Service Sector Growth Slows in June

(Photo: Reuters)

The ISM Report on Business, the Institute for Supply Management’s gauge of service-sector growth declined to 55.5 last month from 56.5 in June. The reading also fell short of the expectation for a reading of 56.

“According to the NMI, 15 non-manufacturing industries reported growth in July,” said Anthony Nieves, CPSM, C.P.M., CFPM, chair of the Institute for Supply Management (ISM) Non-Manufacturing Business Survey Committee. “The majority of the respondents’ comments reflect stability and continued growth for their respective companies and a positive outlook on the economy.”

SERVICE SECTOR NDUSTRY PERFORMANCE

The 15 non-manufacturing industries reporting growth in July — listed in order — are: Arts, Entertainment & Recreation; Educational Services; Accommodation & Food Services; Real Estate, Rental & Leasing; Retail Trade; Utilities; Health Care & Social Assistance; Public Administration; Finance & Insurance; Management of Companies & Support Services; Transportation & Warehousing; Wholesale Trade; Construction; Information; and Professional, Scientific & Technical Services. The three industries reporting contraction in July are: Other Services; Agriculture, Forestry, Fishing & Hunting; and Mining.

Readings above 50 indicate expansion, while those below point to contraction.

ISM^® NON-MANUFACTURING SURVEY RESULTS AT A GLANCE COMPARISON OF ISM^® NON-MANUFACTURING AND ISM^® MANUFACTURING SURVEYS* JULY 2016
	Non-Manufacturing						Manufacturing
Index	Series Index Jul	Series Index Jun	Percent Point Change	Direction	Rate of Change	Trend** (Months)	Series Index Jul	Series Index Jun	Percent Point Change
NMI^®/PMI^®	55.5	56.5	-1.0	Growing	Slower	78	52.6	53.2	-0.6
Business Activity/Production	59.3	59.5	-0.2	Growing	Slower	84	55.4	54.7	+0.7
New Orders	60.3	59.9	+0.4	Growing	Faster	84	56.9	57.0	-0.1
Employment	51.4	52.7	-1.3	Growing	Slower	2	49.4	50.4	-1.0
Supplier Deliveries	51.0	54.0	-3.0	Slowing	Slower	7	51.8	55.4	-3.6
Inventories	54.0	55.5	-1.5	Growing	Slower	16	49.5	48.5	+1.0
Prices	51.9	55.5	-3.6	Increasing	Slower	4	55.0	60.5	-5.5
Backlog of Orders	51.0	47.5	+3.5	Growing	From Contracting	1	48.0	52.5	-4.5
New Export Orders	55.5	53.0	+2.5	Growing	Faster	2	52.5	53.5	-1.0
Imports	53.0	54.0	-1.0	Growing	Slower	6	52.0	52.0	0.0
Inventory Sentiment	63.0	62.5	+0.5	Too High	Faster	230	N/A	N/A	N/A
Customers’ Inventories	N/A	N/A	N/A	N/A	N/A	N/A	51.0	51.0	0.0
Overall Economy				Growing	Slower	84
Non-Manufacturing Sector				Growing	Slower	78

* 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.

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PPD Business Staff

PPD Business, the economy-reporting arm of People's Pundit Daily, is "making sense of current events." We are a no-holds barred, news reporting pundit of, by, and for the people.