Service Sector Echoes Manufacturing's Slow Growth In April

ByJohn S. McClenahen Mirroring the manufacturing sector of the U.S. economy, the service sector continued to grow in April -- although at a slower pace than it did in March. The Institute for Supply Management's (ISM) business activity index for non-manufacturing was 55.3% in April, down two percentage points from March's 57.3%. A figure above 50% indicates the non-manufacturing sector generally is growing; below 50% is a signal that it's contracting. Looking at the elements that make up the overall index, "the good news . . . is that the new orders index is at 56.4%, 1.5 percentage points above the 54.9% new orders index for March," says Ralph G. Kauffman, chairperson of ISM's non-manufacturing business survey committee and coordinator of the purchasing and supply management program at the University of Houston-Downtown. "The bad news is another increase in the prices index, indicating that non-manufacturing buyers had to pay more for their purchases in April than in March."