The U.S. services sector expanded at a faster pace in October as the non-manufacturing business activity composite index was 59.1 in the month, compared to 56.9 in September, on a seasonally adjusted basis, the Institute for Supply Management reported Wednesday.
Economists polled by Thomson Reuters had expected a 56.5 level.
An index reading below 50 signals a slowing economy, while a level above 50 suggests expansion.
The prices paid index increased to 49.1 from 48.4.
The employment index rose to 59.2 from 58.3.
The business activity/production index climbed to 63.0 from 60.2, the new orders index was at 62.0, up from 56.7; backlog of orders held at 54.5; new export orders grew to 54.5 from 52.5; inventories gained to 52.5 from 51.0; inventory sentiment fell to 63.0 from 65.0; the supplier deliveries index dipped to 52.0 from 52.5; and imports increased to 54.5 from 53.0.
Members' general comments on business in the month included:
- "Less volatile pricing in last month. Concern remains about entering fall migration and Avian Influenza risk." (Accommodation & Food Services)
- "Overall good weather keeps business results strong." (Arts, Entertainment & Recreation)
- "Economy remains steady—new construction (residential and commercial) apparent in most areas serviced. Agriculture weakening significantly—especially cattle." (Finance & Insurance)
- "Changes in Medicare/Medicaid requirements under the ACA are impacting healthcare businesses. Some insurance companies are discontinuing services in some states." (Health Care & Social Assistance)
- "Economic outlook appears consistent, but clients suddenly very conservative with discretionary spending." (Professional, Scientific & Technical Services)
- "Overall business and volume have been very consistent and strong the past month." (Retail Trade)
- "Currently building inventories and work force for Q4, holiday, and peak seasons." (Transportation & Warehousing)
- "Overall our business continues to grow at an unprecedented rate. We believe it to be in direct correlation to the price of gas giving the consumer more expendable income." (Wholesale Trade)
