The NMI index from the Institute for Supply Management’s non-manufacturing survey was a reading of 58.6 in August. This is an increase from the 56.0 reading in July, and indicates economic expansion in the services sector at a faster pace.
Not since February of 2011 has the index been this high. The ISM non-manufacturing index has been in expansion ( a reading greater than 50 ) for 44 consecutive months now.
In his 2021 year-end letter, Baupost's Seth Klarman looked at the year in review and how COVID-19 swept through every part of our lives. He blamed much of the ills of the pandemic on those who choose not to get vaccinated while also expressing a dislike for the social division COVID-19 has caused. Q4 2021 Read More
The performance by industry:
The 16 non-manufacturing industries reporting growth in August — listed in order — are: Educational Services; Management of Companies & Support Services; Information; Accommodation & Food Services; Public Administration; Construction; Finance & Insurance; Professional, Scientific & Technical Services; Retail Trade; Utilities; Transportation & Warehousing; Real Estate, Rental & Leasing; Agriculture, Forestry, Fishing & Hunting; Other Services; Wholesale Trade; and Health Care & Social Assistance. The two industries reporting contraction in August are: Mining; and Arts, Entertainment & Recreation.
What the respondents are saying:
- “High demand for products is driving expansion.” (Management of Companies & Support Services)
- “We continue to see growth in the retail and wholesale sectors of our business, and expect to see new orders for our products continue to grow as well.” (Information)
- “We seem to have a flurry of activity in our pipeline.” (Construction)
- “Business orders are up and improving. Still concerned about sustainability through Q4.” (Professional, Scientific & Technical Services)
- “Experiencing a strong housing rebound and continued solid performance by the tourism sector.” (Public Administration)
- “Conditions continue to show improvement.” (Retail Trade)
- “Generally slow, increasing economy.” (Transportation & Warehousing)
The ISM non-manufacturing survey is the last the leading U.S. business surveys to report for the month of August. Currently, all indexes indicate economic expansion.