NEW YORK – “Service sector activity slowed in May,” according to the Federal Reserve Bank of Richmond service-sector activity survey, released Tuesday, “Retail sales dwindled as shopper traffic dropped sharply; big ticket sales remained in decline. Revenues also weakened at non-retail services firms. Looking ahead six months, retail merchants pulled back from their optimism of a month ago. Non-retail services providers maintained a positive outlook, but were less upbeat than in April.”
Overall, the service sector revenues index decreased to 9 in May, from 28 in April, while the number of employees index held at 12, the average wage index rose climbed to 22 from 10, and the expected product demand during the next six months index slumped to 20 from 37.
The indexes are the percentage of responding firms reporting increase, less the percentage reporting a decrease.
By sector, the retail area excluding services firms reported the sales revenues index slumped to 3 in May from 24 in April, the number of employees index reversed to positive 1 from negative 17, while the average wages index improved to negative 1 from negative 2. The inventories index slipped to negative 3 from negative 1, while the big-ticket sales index narrowed to negative 27 from negative 31. The shopper traffic index fell to negative 29 from positive 34, while expected product demand during the next six months decreased to negative 4 from positive 21.
For services firms excluding retail, the revenues index was 9, compared to 26 last month, while the number of employees index slid to 14 from 22, and the average wage index climbed to 29 from 15. The expected product demand during the next six months index fell to 25 from 43.
The current price trend for the two sectors together slid to 0.85 from 1.02, while holding at 1.17 for retail alone and slowing to 0.85 from 1.01 for services, excluding retail.
The expected price trend index for the two sectors together fell to 1.43 in May from 1.61 in April, while increasing to 1.94 from 1.70 for retail alone and dipping to 1.32 from 1.56 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.
