NEW YORK – “Activity in the service sector surged in December,” according to the Federal Reserve Bank of Richmond service-sector activity survey, released today, “Retail sales rose sharply and shopper traffic increased. However, weakness in big-ticket sales continued. Retail inventories grew rapidly this month. At non-retail services firms, revenue growth was a bit more widespread than a month ago. Looking ahead six months, survey respondents anticipated a stronger market for their goods and services.”
The indexes are the percentage of responding firms reporting increase, less the percentage reporting a decrease.
Overall, the service sector revenues index increased to 21 in December, from 7 in November, while the number of employees index surged to 15 from 1, the average wage index rose crept to 10 from 7, and the expected product demand during the next six months index climbed to 26 from 24.
By sector, the retail area excluding services firms reported the sales revenues index reversed to positive 25 in December from negative 16 in November, the number of employees index rose to zero from negative 16, while the average wages index gained to 20 from zero. The inventories index soared to 32 from 4, while the big-ticket sales index remained negative 25. The shopper traffic index dropped to negative 19 from negative 1, while expected product demand during the next six months surged to 35 from 15.
For services firms excluding retail, the revenues index was 17, compared to 15 last month, while the number of employees index rose to 21 from 2, and the average wage index slipped to 8 from 10. The expected product demand during the next six months index slid to 23 from 24.
The current price trend for the two sectors together fell to 0.65 from 0.80, while falling to 0.84 from 1.27 for retail alone and slowing to 0.55 from 0.67 for services, excluding retail.
The expected price trend index for the two sectors together rose to 1.31 in December from 1.30 in November, while decreasing to 1.26 from 1.92 for retail alone and gaining to 1.36 from 1.00 for services, excluding retail.
All firms surveyed are located within the Fifth Federal Reserve District, which includes the District of Columbia, Maryland, North Carolina, South Carolina, Virginia, and most of West Virginia.
