According to the the latest Institute for Supply Management Report On Business, economic activity in the services sector grew in September for the 28th month in a row — with the Services PMI registering 56.7%.

“In September, the Services PMI registered 56.7%, 0.2 percentage point lower than August’s reading of 56.9 %. The Business Activity Index registered 59.1%, a decrease of 1.8 percentage points compared to the reading of 60.9% in August,” Anthony Nieves, chair of the Institute for Supply Management, said. “The New Orders Index figure of 60.6% is 1.2 percentage points lower than the August reading of 61.8%.The Supplier Deliveries Index registered 53.9%, 0.6 percentage point lower than the 54.5% reported in August. (Supplier Deliveries is the only ISM Report On Business index that is inversed; a reading of above 50% indicates slower deliveries, which is typical as the economy improves and customer demand increases.) The prices Index decreased for the fifth consecutive month in September, down 2.8 percentage points to 68.7%. Services businesses still continue to struggle to replenish their stocks, as the Inventories Index contracted for the fourth consecutive month; the reading of 44.1% is down 2.1 percentage points from August’s figure of 46.2%. The Inventory Sentiment Index (47.2%, up 0.1 percentage point from August’s reading of 47.1%) contracted for the second consecutive month in September.”

“According to the Services PMI^®, 15 industries reported growth. The composite index indicated growth for the 28th consecutive month after a two-month contraction in April and May 2020. Growth continues — at a slightly slower rate — for the services sector, which has expanded for all but two of the last 152 months,” Nieves said. “The services sector had a slight pullback in growth for the month of September due to decreases in business activity and new orders. Employment improved and supplier deliveries slowed at a slightly slower rate. Based on comments from Business Survey Committee respondents, there have been improvements regarding supply chain efficiency, operating capacity and materials availability; however, performance remains less than ideal. Employment continued to improve despite the restricted labor market.”

INDUSTRY PERFORMANCE

The 15 services industries reporting growth in September — listed in order — are: mining; other services; educational services; agriculture, forestry, fishing & hunting; public administration; retail trade; wholesale trade; information; utilities; professional, scientific & technical services; health care & social assistance; finance & insurance; real estate, rental & leasing; construction; and management of companies & support services. the three industries reporting a decrease in the month of september are: accommodation & food services; arts, entertainment & recreation; and transportation & warehousing.

Services ISM^® Report On Business^® data is seasonally adjusted for the Business Activity, New Orders, Employment and Prices indexes. Manufacturing ISM^® Report On Business^® data is seasonally adjusted for New Orders, Production, Employment and Inventories indexes. *Number of months moving in current direction.