Non-Manufacturing Report On US Business for May

By Admin

Date → Wednesday, June 8, 2011

Tags → report on business

Economic activity in the US non-manufacturing sector grew in May for the 18th consecutive month, say the nation's purchasing and supply executives in the latest Non-Manufacturing ISM Report On Business(R).

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 54.6 percent in May, 1.8 percentage points higher than the 52.8 percent registered in April, and indicating continued growth at a faster rate in the non-manufacturing sector. The Non-Manufacturing Business Activity Index decreased 0.1 percentage point
to 53.6 percent, reflecting growth for the 22nd consecutive month, but
at a slightly slower rate than in April. The New Orders Index increased
by 4.1 percentage points to 56.8 percent. The Employment Index increased
2.1 percentage points to 54 percent, indicating growth in employment for
the ninth consecutive month and at a faster rate. The Prices Index decreased 0.5 percentage point to 69.6 percent, indicating that prices increased at a slightly slower rate in May when compared to April.

According to the NMI, 16 non-manufacturing industries reported growth in May. Respondents' comments are mostly positive about overall business conditions. There is a sentiment that there is a degree of stability in the economy; however, a continued concern exists over fuel costs and various volatile commodities."

INDUSTRY PERFORMANCE (Based on the NMI)

The 16 industries reporting growth in May based on the NMI composite index - listed in order - are: Mining; Utilities; Arts, Entertainment and Recreation; Other Services; Agriculture, Forestry, Fishing and Hunting; Real Estate, Rental and Leasing; Management of Companies and Support Services; Transportation and Warehousing; Construction; Accommodation and Food Services; Health Care and Social Assistance; Information; Public Administration; Finance and Insurance; Professional, Scientific and Technical Services; and, Wholesale Trade. The two industries reporting contraction in May are: Educational Services and Retail Trade.

WHAT RESPONDENTS ARE SAYING …

"Business is O.K. Fuel prices and truck availability are starting to be a negative force on our supply chain." (Agriculture, Forestry, Fishing and Hunting)

"Business conditions are stabilized." (Health Care and Social Assistance)

"First and second quarters of 2011 have been up 25 percent over 2010;
however, we expect a slight slowdown over the summer months." (Professional, Scientific and Technical Services)

"Uncertainty within commodity markets, especially fuel- and oil-based
products, is putting pressure once again and forcing us to retrench as
we look for stability. We expect the remainder of 2011 and at least the first two quarters of 2012 to be tumultuous." (Retail Trade)

"Volatile commodity prices adding stress to meat and dairy producers;
increasing fuel prices are a problem for many." (Wholesale Trade)