Economic activity in the services sector continued to expand in November, according to the latest Institute for Supply Management (ISM) Services PMI Report. The Services PMI registered at 52.6% and is in expansion territory for the ninth time in 2025.
The report was issued by Steve Miller, chair of the ISM services business survey committee.
“In November, the Services PMI registered a reading of 52.6%, 0.2 percentage point higher than the October figure of 52.4%. The Business Activity Index continued in expansion territory in November, registering 54.5%, 0.2 percentage point higher than the reading of 54.3% recorded in October. The New Orders Index also remained in expansion in November, with a reading of 52.9%, 3.3 percentage points below October’s figure of 56.2% but 0.9 percentage point above its 12-month average of 51.7%. The Employment Index contracted for the sixth month in a row with a reading of 48.9%, a 0.7-percentage point improvement from the 48.2% recorded in October — the fourth consecutive monthly increase since a reading of 46.4% in July,” Miller said. “The Supplier Deliveries Index registered 54.1%, 3.3 percentage points higher than the 50.8% recorded in October and 2.2 percentage points above its 12-month average of 51.9%. This is the 12th consecutive month that the index has been in expansion territory, indicating slower supplier delivery performance. (Supplier Deliveries is the only ISM PMI Reports index that is inversed; a reading of above 50% indicates slower deliveries, which is typical as the economy improves and customer demand increases.)”
Miller added, “The Prices Index registered 65.4% in November, its lowest reading since hitting 65.1% in April 2025. The November figure was a 4.6-percentage point drop from October’s reading of 70%. The index has exceeded 60% for 12 straight months. The Inventories Index registered 53.4% in November, an increase of 3.9 percentage points from October’s figure of 49.5%, a return to expansion after two months in contraction territory. The Inventory Sentiment Index expanded for the 31st consecutive month, registering 54.8%, down 0.7 percentage point from October’s figure of 55.5%. The Backlog of Orders Index was in contraction territory for the ninth month in a row, registering 49.1% in November, an 8.3-percentage point increase from the October figure of 40.8%, and 3.8 percentage points above its 12-month average of 45.3%.”
Miller continued, “Twelve industries reported growth in November, one more than in October, while the number reporting contraction decreased from six to five. The November Services PMI reading of 52.6% is 0.9 percentage point above the 12-month average of 51.7%. However, the 12-month average continues at its lowest level since August 2024 (51.7%) for the second month in a row, and the second lowest since June 2010 (51.4%).”
Miller concluded, “November’s Services PMI is a continuation of a downward trend (as noted in the October report) of more than 10 percentage points in the 12-month average since February 2022, when it was 62.6%. The continued expansion in both the Business Activity and New Orders indexes in November, and the highest Backlog of Orders index reading since February 2025 are positive signs of an emerging recovery for the services sector. On the downside, tariffs and the government shutdown continue to be noted by survey respondents as impacting both demand and costs. The Employment index reading of 48.9%, while still in contraction, is its highest reading since it registered 50.7% in May 2025. The highest Supplier Deliveries index figure (54.1%) since October 2024 — a reading in expansion indicates slower deliveries by suppliers — was likely due to air traffic disruptions from the government shutdown and customs impacts related to changing tariffs. The tragic UPS plane crash on November 4 is also a sobering reminder, especially with the coming holidays that rely on timely deliveries, of the risks that logistics providers take every day on our roads, waterways and skies to ensure that supply chains operate smoothly.”
The 12 services industries reporting growth in November — listed in order — are:
- Retail Trade
- Arts, Entertainment and Recreation
- Accommodation and Food Services
- Wholesale Trade
- Health Care and Social Assistance
- Educational Services
- Public Administration
- Agriculture, Forestry, Fishing and Hunting
- Finance and Insurance
- Information
- Professional, Scientific and Technical Services
- Utilities
The five industries reporting a contraction in the month of November are:
- Construction
- Real Estate, Rental and Leasing
- Mining
- Management of Companies and Support Services
- Transportation and Warehousing
