The U.S. services sector expanded at a slower pace in August as the non-manufacturing business activity composite index was 59.0 in the month, compared to 60.3 in July, on a seasonally adjusted basis, the Institute for Supply Management reported Thursday.
Economists polled by Thomson Reuters had expected a 58.0 level.
An index reading below 50 signals a slowing economy, while a level above 50 suggests expansion.
The prices paid index declined to 50.8 from 53.7.
The employment index fell to 56.0 from 59.6.
The business activity/production index dipped to 63.9 from 64.9, the new orders index was at 63.4, off from 63.8; backlog of orders rose to 56.5 from 54.0; new export orders slid to 52.0 from 56.5; inventories dropped to 54.5 from 57.0; inventory sentiment grew to 69.0 from 63.5; the supplier deliveries index fell to 52.5 from 53.0; and imports increased to 51.5 from 50.5.
Members' general comments on business in the month included:
- "Overall business is increasing." (Health Care & Social Assistance)
- "Business in commercial real estate and management thereof continues to be strong. Companies want to get out of directly managing brick and mortar structures and the systems that support those assets." (Management of Companies & Support Services)
- "Business is good and do not see anything to slow it down." (Construction)
- "Trending towards a positive year-end." (Finance & Insurance)
- "Avian influenza has impacted the egg market taking 40 percent of the raw material out of the supply chain. Prices have doubled and shortages of liquid eggs have emerged." (Accommodation & Food Services)
- "Some slowdown in business activity mostly due to vacations. Despite this, the variance still meets Q3 forecasted business level expectations." (Professional, Scientific & Technical Services)
- "Business and our market sector continue to be strong with continued growth and stability." (Retail Trade)
- "Sales continue to increase and port congestion on the East Coast is easing up. Intermodal transit time has increased by two days because of rail repairs." (Wholesale Trade)
