Wednesday, October 05, 2011

ISM Non-Manufacturing Index indicates expansion in September

by Bill McBride on 10/05/2011 10:00:00 AM

The September ISM Non-manufacturing index was at 53.0%, down from 53.3% in August. The employment index decreased in September to 48.7%, down from 51.6% in August. Note: Above 50 indicates expansion, below 50 contraction.

From the Institute for Supply Management: September 2011 Non-Manufacturing ISM Report On Business®

Economic activity in the non-manufacturing sector grew in September for the 22nd consecutive month, say the nation's purchasing and supply executives in the latest Non-Manufacturing ISM Report On Business®.

The report was issued today by Anthony Nieves, C.P.M., CFPM, chair of the Institute for Supply Management™ Non-Manufacturing Business Survey Committee. "The NMI registered 53 percent in September, 0.3 percentage point lower than the 53.3 percent registered in August, and indicating continued growth at a slightly slower rate in the non-manufacturing sector. The Non-Manufacturing Business Activity Index increased 1.5 percentage points to 57.1 percent, reflecting growth for the 26th consecutive month. The New Orders Index increased by 3.7 percentage points to 56.5 percent. The Employment Index decreased 2.9 percentage points to 48.7 percent, indicating contraction in employment after 12 consecutive months of growth. The Prices Index decreased 2.3 percentage points to 61.9 percent, indicating prices increased at a slower rate in September when compared to August. According to the NMI, nine non-manufacturing industries reported growth in September. Respondents' comments reflect an uncertainty about future business conditions and the direction of the economy."
emphasis added
ISM Non-Manufacturing Index Click on graph for larger image in graph gallery.

This graph shows the ISM non-manufacturing index (started in January 2008) and the ISM non-manufacturing employment diffusion index.

This was slightly above the consensus forecast of 52.9% and indicates slightly slower expansion in September than in August. However the employment index indicated contraction in September.