Unlike the manufacturing sector, the non-manufacturing sector of the U.S. economy grew faster in December 2005 than it had in November, according to figures released last week by the Tempe, Ariz.-based Institute for Supply Management (ISM).
The institute's index of business activity for non-manufacturing industries advanced 1.3 percentage points to 59.8% last month. A figure above 50% indicates the sector generally is growing; a figure below 50% signals that it is contracting. December was the sector's 33rd consecutive month of growth.
Both new orders and employment grew at a faster pace in December. New orders were up 2.4 percentage points; job growth was a more modest tenth of a percent.
"Concern about the relatively high level of energy prices has lessened somewhat, although the effects of high energy prices are still being felt through price increases and surcharges for other products," noted 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 price component of ISM's overall non-manufacturing business activity index increased in December, but at a rate 4.7 percentage points below November's pace.