Last month, the non-manufacturing sector of the U.S. economy, the segment that includes construction, mining, utilities and business services, grew for the 28th consecutive month. But the pace was slower than during June, according to data released Aug. 3 by the Institute for Supply Management (ISM), Tempe, Ariz. Its business activity index for non-manufacturing was 60.5% last month, 1.7 percentage points below June's 62.2%. An index figure above 50% indicates the non-manufacturing sector generally is expanding; a figure below 50% signals it is contracting.
With the exception of prices non-manufacturers pay for fuel and other supplies, "there were no unusually large changes in the [individual] indexes," notes Ralph G. Kauffman, chair of ISM's non-manufacturing business survey committee and coordinator of the supply chain management program at the University of Houston-Downtown. The non-manufacturing sector's price index, however, rose a spectacular 10.5 percentage points between June and July, to 70.3% from 59.8%.
The pace of new orders and order backlogs for non-manufacturers picked up between June and July, but employment growth was slower in July than it had been in June.