NEW YORK - The Institute for Supply Management's non-manufacturing business activity composite index was 54.3 in October, up from 53.2 in September, on a seasonally adjusted basis, the group said today.
Economists polled by Thomson Reuters had expected a 53.5 level.
An index reading below 50 signals a slowing economy, while a level above 50 suggests expansion.
The prices paid index, closely watched for signs of inflation, surged to 68.3 from 60.1.
The employment index increased to 50.9 from 50.2.
The business activity/production index grew to 58.4 from 52.8, the new orders index was at 56.7, up from 54.9; backlog of orders gained to 52.0 from 48.0; new export orders decreased to 55.5 from 58.0; inventories increased to 47.5 from 47.0; inventory sentiment rose to 61.5 from 59.5; the supplier deliveries index fell to 51.0 from 55.0; and imports increased to 54.0 from 53.0.
“The NMI (Non-Manufacturing Index) registered 54.3 percent in October, 1.1 percentage points higher than the 53.2 percent registered in September, and indicating continued growth in the non-manufacturing sector at a slightly faster rate,” said Anthony Nieves, chair of the ISM's Non-Manufacturing Business Survey Committee. “The Non-Manufacturing Business Activity Index increased 5.6 percentage points to 58.4 percent, reflecting growth for the 11th consecutive month at a substantially faster rate than in September. The New Orders Index increased 1.8 percentage points to 56.7 percent, and the Employment Index increased 0.7 percentage point to 50.9 percent, indicating growth in employment for the second consecutive month and the fourth time in the last six months. The Prices Index increased 8.2 percentage points to 68.3 percent, indicating that prices increased significantly faster in October. According to the NMI, 11 non-manufacturing industries reported growth in October. Respondents’ comments remain mixed about business conditions and vary by industry and company. The trend of the overall comments indicates that there are signs of economic stabilization.”
Members' general comments on business in the month included:
“Sales are still down compared to last year, but showing a slight increase.” (Public Administration)
“Economy still slow for our industry, with very small signs of recovery. Strong downward pricing pressures from customers affecting business.” (Professional, Scientific & Technical Services)
“Some positive growth in comp [comparable] sales over the past 2 to 3 months.” (Accommodation & Food Services)
“Business is picking up ever so slowly, but improving.” (Transportation & Warehousing)
“Generally stable-to-improving demand for our products.” (Wholesale Trade)
