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Friday, October 3, 2014

Non-Manufacturing Growth Slows Slightly in September

Composite growth slowed slightly but remained very strong for ISM's non-manufacturing sample where September's index came in at 58.6 vs August's 59.6. Growth in new orders slowed slightly but is very strong at 61.0 vs August's 63.8. The same is true for business activity (akin to a production index) which slowed to 62.9 from 65.0.

Employment is a special plus in the report, rising 1.4 points to 58.5 which is the strongest reading of the recovery and underscores this morning's recovery low unemployment rate. Backlogs are up as are exports which in this report center on software and intellectual property.

Looking at industries, construction leads the sample in the month followed by retail in what is very welcome strength for two important sectors. Mining is one of the few industries in the month's contraction camp. In sum, this report points to a solid though non-accelerating ending to the third quarter for the bulk of the nation's economy.


Recent History Of This Indicator:
The composite index from the ISM non-manufacturing survey for August showed extending acceleration with the index rising 0.9 points to 59.6 from an already very strong 58.7 in July. The gain was led by the business index which rose 2.6 points to 65.0 in a reading that indicated exceptionally strong output. Employment was also a big plus, up 1.1 points to 57.1. One reading was not so positive and that was new orders. Though coming in at 63.8, the rate of growth was down 1.1 points from July's 64.9.

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