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ISM Non-Manufacturing Index slipped to 57.1% in April 2022
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Economic activity in the services sector grew in April for the 23rd month in a row — with the Services PMI® registering 57.1 percent — say the nation’s purchasing and supply executives in the latest Services ISM® Report On Business®.
The report was issued today by Anthony Nieves, CPSM, C.P.M., A.P.P., CFPM, Chair of the Institute for Supply Management® (ISM®) Services Business Survey Committee: “In April, the Services PMI® registered 57.1 percent, 1.2 percentage points lower than March’s reading of 58.3 percent. The Business Activity Index registered 59.1 percent, an increase of 3.6 percentage points compared to the reading of 55.5 percent in March, and the New Orders Index figure of 54.6 percent is 5.5 percentage points lower than the March reading of 60.1 percent.
“The Supplier Deliveries Index registered 65.1 percent, 1.7 percentage points higher than the 63.4 percent reported in March. (Supplier Deliveries is the only ISM® Report On Business® index that is inversed; a reading of above 50 percent indicates slower deliveries, which is typical as the economy improves and customer demand increases.)
“The Prices Index reached an all-time high of 84.6 percent, up 0.8 percentage point from the March figure of 83.8 percent and surpassing the previous record of 83.9 percent in December 2021. Services businesses are continuing to replenish inventories, as the Inventories Index expanded for a third straight month; the reading of 52.3 percent is up 0.6 percentage point from March’s figure of 51.7 percent. The Inventory Sentiment Index (46.7 percent, up 6.5 percentage points from March’s reading of 40.2 percent) contracted in April for the second consecutive month, indicating that inventories are in ‘too low’ territory and insufficient for current business requirements.”
Nieves continues, “According to the Services PMI®, 17 industries reported growth. The composite index indicated growth for the 23rd consecutive month after a two-month contraction in April and May 2020. Growth continues for the services sector, which has expanded for all but two of the last 147 months. There was a pullback in the composite index, mostly due to the restricted labor pool (impacting the Employment Index) and the slowing of new orders growth. Business activity remains strong; however, high inflation, capacity constraints and logistical challenges are impediments, and the Russia-Ukraine war continues to affect material costs, most notably of fuel and chemicals.”
INDUSTRY PERFORMANCE
The 17 services industries reporting growth in April — listed in order — are: Construction; Utilities; Management of Companies & Support Services; Real Estate, Rental & Leasing; Accommodation & Food Services; Public Administration; Professional, Scientific & Technical Services; Educational Services; Mining; Transportation & Warehousing; Wholesale Trade; Finance & Insurance; Other Services; Health Care & Social Assistance; Retail Trade; Arts, Entertainment & Recreation; and Agriculture, Forestry, Fishing & Hunting. The only industry reporting a decrease in April is Information.
Posted: May 4, 2022 Wednesday 10:00 AM