The U.S. services sector expanded at a slightly slower pace in September as the non-manufacturing business activity composite index was 54.4 in the month, compared to 58.6 in August, on a seasonally adjusted basis, the Institute for Supply Management reported Thursday.
Economists polled by Thomson Reuters had expected a 57.5 level.
An index reading below 50 signals a slowing economy, while a level above 50 suggests expansion.
The prices paid index gained to 57.2 from 53.4.
The employment index decreased to 52.7 from 57.0.
The business activity/production index dropped to 55.1 from 62.2, the new orders index was at 59.6, down from 60.5; backlog of orders held at 50.5; new export orders rose to 57.5 from 50.5; inventories dropped to 54.5 from 56.0; inventory sentiment fell to 62.0 from 63.5; the supplier deliveries index decreased to 50.0 from 54.5; and imports slid to 51.5 from 55.0.
Members' general comments on business in the month included:
"Overall business conditions are slowing - small manpower decrease of 5 percent." (Construction)
"Business levels continue to be strong. Shifting from transient to group travelers." (Accommodation & Food Services)
"Increased activity following summer vacations, but several postponements as well. Clients still unsure about the economy and business costs (e.g., healthcare)." (Professional, Scientific & Technical Services)
"The federal government's spending is increasing greatly as agencies execute their final budgets and utilize fiscal year 2013 appropriated funds prior to their expiration on September 30th. This has caused a major increase in procurement activity for goods and services. Budgets are uncertain for fiscal year 2014, so some items requiring funding in future years are not being purchased." (Public Administration)
"Business has leveled off - not much in the way of growth." (Retail Trade)
"Some pick-up in sequential sales growth, but still flat with last year." (Wholesale Trade)
