The U.S. services sector continued to expand in November although at a slower pace than in the previous month as the non-manufacturing business activity composite index was 57.4 versus to 60.1 in October, on a seasonally adjusted basis, the Institute for Supply Management reported Tuesday.
An index reading below 50 signals a slowing economy, while a level above 50 suggests expansion.
Economists polled by IFR Markets had expected a level of 59.2.
“The Non-Manufacturing Business Activity Index decreased to 61.4%, 0.8 percentage point lower than the October reading of 62.2%, reflecting growth for the 100th consecutive month, at a slightly slower rate in November,” ISM said in a release. “The New Orders Index registered 58.7%, 4.1 percentage points lower than the reading of 62.8 percent in October. The Employment Index decreased 2.2 percentage points in November to 55.3% from the October reading of 57.5%. The Prices Index decreased by 2 percentage points from the October reading of 62.7% to 60.7%, indicating prices increased in November for the sixth consecutive month.”
Members' general comments on business in the month included:
- "Domestic business is strong, with positive growth indicators for 2018 from both internal sources and client feedback." (Management of Companies & Support Services)
- "Construction labor continues to be constrained in the West." (Construction)
- "Steady; no material changes." (Finance & Insurance)
- "We continue to struggle with understanding the [potential] changes to the Affordable Care Act, and are trying to be flexible in how we respond. Also, Hurricane Maria has affected some of our pharmaceutical supplies." (Health Care & Social Assistance)
- "Mixed bag of goods for November 2017. Typical seasonal increases for specific braising cuts of beef as the holidays approach. Some volatility on produce items such as brussel sprouts. Expect cream to spike due to holiday season." (Accommodation & Food Services)
- "Business seems to be leveling off. Attribute this to the holiday season that is approaching." (Professional, Scientific & Technical Services)
- "Business is strong, but not as strong as Q3." (Retail Trade)
- "Bookings would suggest a strong run to the end of the year." (Wholesale Trade)