Nation’s service sector shows November decline
Phoenix Business Journal - by Adam Kress
New research from a Tempe economic group shows that the nation’s service sector contracted sharply in November.
The Institute for Supply Management’s non-manufacturing index fell to 37.3 from 44.4 in October. Any reading below 50 indicates contraction in the overall economy. A reading of 50 or above indicates growth.
The index had stood around the 50 mark for most of the 11 months since its January revamping, but has tumbled for the past two months. The greatest contraction occurred in the business activity/production component, which fell to 33 in November from 44.2 in October.
The employment index posted the second greatest percentage point change, contracting to 31.3 from 41.5.
Employment has the lowest index figure of the report, weighed down by an economy shedding jobs at record rates. In November, private sector employers cut a quarter-million jobs, more than expected, according to the latest ADP employment numbers.
The ISM non-manufacturing index was reformulated in January to a composite index, taking into account business activity, new orders, employment and supplier deliveries. Prior to January, the report surveyed only business activity.
For more: www.ism.ws .
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