2014

NMI™ at 52.2%; June Non-Manufacturing ISM Report On Business®; Business Activity Index at 51.7%; New Orders Index at 50.8%; Employment Index at 54.7%

DO NOT CONFUSE THIS NATIONAL REPORT with the various regional purchasing reports released across the country. The national report's information reflects the entire United States, while the regional reports contain primarily regional data from their local vicinities. Also, the information in the regional reports is not used in calculating the results of the national report. The information compiled in this report is for the month of June 2013.

TEMPE, Ariz., July 3, 2013 /PRNewswire/ -- Economic activity in the non-manufacturing sector grew in June for the 42nd consecutive month, say the nation's purchasing and supply executives in the latest Non-Manufacturing ISM Report On Business®.

The report was issued today by Anthony Nieves, C.P.M., CFPM, chair of the Institute for Supply Management Non-Manufacturing Business Survey Committee. "The NMI registered 52.2 percent in June, 1.5 percentage points lower than the 53.7 percent registered in May. This indicates continued growth at a slightly slower rate in the non-manufacturing sector. The Non-Manufacturing Business Activity Index registered 51.7 percent, which is 4.8 percentage points lower than the 56.5 percent reported in May, reflecting growth for the 47th consecutive month. The New Orders Index decreased by 5.2 percentage points to 50.8 percent, and the Employment Index increased 4.6 percentage points to 54.7 percent, indicating growth in employment for the 11th consecutive month. The Prices Index increased 1.4 percentage points to 52.5 percent, indicating prices increased at a faster rate in June when compared to May. According to the NMI, 14 non-manufacturing industries reported growth in June. Respondents' comments are mixed about business conditions depending upon the industry and company. The majority indicate that growth has been slow and incremental; however, it is still better year over year."

INDUSTRY PERFORMANCE

The 14 non-manufacturing industries reporting growth in June — listed in order — are:  Management of Companies & Support Services; Arts, Entertainment & Recreation; Transportation & Warehousing; Wholesale Trade; Retail Trade; Information; Accommodation & Food Services; Utilities; Real Estate, Rental & Leasing; Public Administration; Agriculture, Forestry, Fishing & Hunting; Finance & Insurance; Construction; and Professional, Scientific & Technical Services. The four industries reporting contraction in June are: Mining; Other Services; Educational Services; and Health Care & Social Assistance.

WHAT RESPONDENTS ARE SAYING …

  • "Sales increased slightly again for the fourth consecutive month over last year's sales for the same period. Hiring increased slightly as well." (Public Administration)
  • "Lower revenues due to healthcare reform, causing pressure to cut costs and headcount." (Health Care & Social Assistance)
  • "Business is steady, but profitability is coming from cost savings measures. Some divisions expected to be flat or slightly below expectations." (Professional, Scientific & Technical Services)
  • "Business environment certainty continues to stabilize. Effects on our business lag. We expect as housing and building continue to improve, we will see gains." (Management of Companies & Support Services)
  • "Slow growth — intense downward price pressure from customers." (Wholesale Trade)
  • "The roller coaster ride is not over yet. Customer counts are well below expectations, but overall revenue is higher than expected. The fluctuations are significant, week to week as much as YTD, resulting in problems with accurate forecasting." (Arts, Entertainment & Recreation)

ISM NON-MANUFACTURING SURVEY RESULTS AT A GLANCE

COMPARISON OF ISM NON-MANUFACTURING AND ISM MANUFACTURING SURVEYS*

JUNE 2013




Non-Manufacturing

Manufacturing

Index

Series

Index

Jun

Series

Index

May

Percent

Point

Change

Direction

Rate of Change

Trend**

(Months)

Series

Index

Jun

Series

Index

May

Percent

Point

Change











NMI/PMI

52.2

53.7

-1.5

Growing

Slower

42

50.9

49.0

+1.9

Business Activity/

   Production

51.7

56.5

-4.8

Growing

Slower

47

53.4

48.6

+4.8

New Orders

50.8

56.0

-5.2

Growing

Slower

47

51.9

48.8

+3.1

Employment

54.7

50.1

+4.6

Growing

Faster

11

48.7

50.1

-1.4

Supplier Deliveries

51.5

52.0

-0.5

Slowing

Slower

6

50.0

48.7

+1.3

Inventories

54.5

51.5

+3.0

Growing

Faster

5

50.5

49.0

+1.5

Prices

52.5

51.1

+1.4

Increasing

Faster

45

52.5

49.5

+3.0

Backlog of Orders

52.0

51.5

+0.5

Growing

Faster

5

46.5

48.0

-1.5

New Export Orders

47.5

50.0

-2.5

Contracting

From Unchanged

1

54.5

51.0

+3.5

Imports

53.5

49.5

+4.0

Growing

From Contracting

1

56.0

54.5

+1.5

Inventory Sentiment

61.5

62.5

-1.0

Too High

Slower

193

N/A

N/A

N/A

Customers' Inventories

N/A

N/A

N/A

N/A

N/A

N/A

45.0

46.0

-1.0

* Non-Manufacturing ISM Report On Business® data is seasonally adjusted for Business Activity, New Orders, Prices and Employment. Manufacturing ISM Report On Business® data is seasonally adjusted for New Orders, Production, Employment and Supplier Deliveries.
** Number of months moving in current direction

COMMODITIES REPORTED UP / DOWN IN PRICE, and IN SHORT SUPPLY

Commodities Up in Price
Airfares (2); Asphalt Products; Beef (7); Cheese; Corrugated Boxes; Dairy; #1 Diesel Fuel (2); #2 Diesel Fuel* (2); Engine Components; Fabricated Pipe; Fuel* (6); Gasoline* (2); Pharmacy Drugs; Pharmacy Supplies; Poultry; and Services.

Commodities Down in Price
Copper Products; #2 Diesel Fuel*; Eggs; Fuel*; Gasoline* (4); Lumber — Pine, Spruce and Treated (2); Natural Gas; Plastic Containers; and Steel Products.

Commodities in Short Supply
Helium is the only commodity reported in short supply.

Note: The number of consecutive months the commodity is listed is indicated after each item.
*Reported as both up and down in price.

JUNE 2013 NON-MANUFACTURING INDEX SUMMARIES

NMI

In June, the NMI registered 52.2 percent, indicating continued growth in the non-manufacturing sector for the 42nd consecutive month. This month's reading reflects the lowest reading for the index since February 2010, when the index registered 51.7 percent. A reading above 50 percent indicates the non-manufacturing sector economy is generally expanding; below 50 percent indicates the non-manufacturing sector is generally contracting.

NMI HISTORY

Month

NMI

Month

NMI

Jun 2013

52.2

Dec 2012

55.7

May 2013

53.7

Nov 2012

54.8

Apr 2013

53.1

Oct 2012

54.8

Mar 2013

54.4

Sep 2012

55.2

Feb 2013

56.0

Aug 2012

54.3

Jan 2013

55.2

Jul 2012

52.9

Average for 12 months – 54.4

High – 56.0

Low – 52.2

Business Activity

ISM's Non-Manufacturing Business Activity Index in June registered 51.7 percent, 4.8 percentage points lower than the 56.5 percent registered in May. This month's reading reflects the lowest level for the index since November 2009, when the index registered 50.9 percent. Eleven industries reported increased business activity, and seven industries reported decreased activity for the month of June. Comments from respondents include: "More back to normal after spike" and "Projects are wrapping up and not being replaced."

The industries reporting growth of business activity in June — listed in order — are: Transportation & Warehousing; Management of Companies & Support Services; Utilities; Accommodation & Food Services; Wholesale Trade; Arts, Entertainment & Recreation; Real Estate, Rental & Leasing; Retail Trade; Information; Professional, Scientific & Technical Services; and Finance & Insurance. The industries reporting decreased business activity in June — listed in order — are: Mining; Educational Services; Other Services; Construction; Public Administration; Health Care & Social Assistance; and Agriculture, Forestry, Fishing & Hunting.

Business Activity

%Higher

%Same

%Lower

Index

Jun 2013

26

56

18

51.7

May 2013

31

56

13

56.5

Apr 2013

33

52

15

55.0

Mar 2013

36

51

13

56.5

New Orders

ISM's Non-Manufacturing New Orders Index grew in June for the 47th consecutive month. The index registered 50.8 percent, a decrease of 5.2 percentage points from the 56 percent reported in May. This month's reading reflects the lowest level for the index since July 2009, when it registered 49.7 percent. Comments from respondents include: "Fewer sales" and "Planning/requests leveled off."

The nine industries reporting growth of new orders in June — listed in order — are: Arts, Entertainment & Recreation; Transportation & Warehousing; Agriculture, Forestry, Fishing & Hunting; Management of Companies & Support Services; Wholesale Trade; Retail Trade; Utilities; Information; and Public Administration. The five industries reporting contraction of new orders in June are: Educational Services; Mining; Other Services; Construction; and Health Care & Social Assistance.

New Orders

%Higher

%Same

%Lower

Index

Jun 2013

23

61

16

50.8

May 2013

30

58

12

56.0

Apr 2013

30

56

14

54.5

Mar 2013

31

57

12

54.6

Employment

Employment activity in the non-manufacturing sector grew in June for the 11th consecutive month. ISM's Non-Manufacturing Employment Index registered 54.7 percent, which reflects an increase of 4.6 percentage points when compared to the 50.1 percent registered in May. Ten industries reported increased employment, and five industries reported decreased employment. Comments from respondents include: "Hiring additional resources for new orders" and "Continued growth of business."           

The industries reporting an increase in employment in June — listed in order — are:  Management of Companies & Support Services; Transportation & Warehousing; Information; Public Administration; Wholesale Trade; Construction; Finance & Insurance; Arts, Entertainment & Recreation; Accommodation & Food Services; and Retail Trade. The industries reporting a reduction in employment in June are: Mining; Other Services; Agriculture, Forestry, Fishing & Hunting; Utilities; and Health Care & Social Assistance.

Employment

%Higher

%Same

%Lower

Index

Jun 2013

31

57

12

54.7

May 2013

24

61

15

50.1

Apr 2013

28

57

15

52.0

Mar 2013

26

58

16

53.3

Supplier Deliveries

The Supplier Deliveries Index registered 51.5 percent in June, indicating that supplier deliveries were slower in June for the sixth consecutive month. A reading above 50 percent indicates slower deliveries, while a reading below 50 percent indicates faster deliveries.

The eight industries reporting slower deliveries in June — listed in order — are: Agriculture, Forestry, Fishing & Hunting; Educational Services; Arts, Entertainment & Recreation; Real Estate, Rental & Leasing; Wholesale Trade; Management of Companies & Support Services; Construction; and Professional, Scientific & Technical Services. The four industries reporting faster deliveries in June are:  Mining; Transportation & Warehousing; Finance & Insurance; and Information. Six industries reported no change in supplier deliveries in June compared to May.

Supplier Deliveries

%Slower

%Same

%Faster

Index

Jun 2013

7

89

4

51.5

May 2013

8

88

4

52.0

Apr 2013

7

88

5

51.0

Mar 2013

9

88

3

53.0

Inventories

ISM's Non-Manufacturing Inventories Index grew in June for the fifth consecutive month. The index registered 54.5 percent, which is 3 percentage points higher than the 51.5 percent reported in May. Of the total respondents in June, 25 percent indicated they do not have inventories or do not measure them. Comments from respondents include: "Building inventory for new orders" and "Warehouses purchased more inventory than needed."

The nine industries reporting an increase in inventories in June — listed in order — are: Mining; Agriculture, Forestry, Fishing & Hunting; Utilities; Information; Real Estate, Rental & Leasing; Arts, Entertainment & Recreation; Transportation & Warehousing; Wholesale Trade; and Public Administration. The three industries reporting decreases in inventories in June are: Health Care & Social Assistance; Retail Trade; and Professional, Scientific & Technical Services.

Inventories

%Higher

%Same

%Lower

Index

Jun 2013

22

65

13

54.5

May 2013

21

61

18

51.5

Apr 2013

25

62

13

56.0

Mar 2013

16

71

13

51.5

Prices

Prices paid by non-manufacturing organizations for purchased materials and services increased in June for the 45th consecutive month. ISM's Non-Manufacturing Prices Index for June registered 52.5 percent, 1.4 percentage points higher than the 51.1 percent reported in May. In June, the percentage of respondents reporting higher prices is 19 percent, the percentage indicating no change in prices paid is 74 percent, and 7 percent of the respondents reported lower prices.

Eleven non-manufacturing industries reported an increase in prices paid during the month of June, in the following order: Educational Services; Accommodation & Food Services; Agriculture, Forestry, Fishing & Hunting; Wholesale Trade; Retail Trade; Arts, Entertainment & Recreation; Health Care & Social Assistance; Real Estate, Rental & Leasing; Construction; Professional, Scientific & Technical Services; and Public Administration. The three industries reporting a decrease in prices paid during June are: Management of Companies & Support Services; Utilities; and Information.

Prices

%Higher

%Same

%Lower

Index

Jun 2013

19

74

7

52.5

May 2013

20

69

11

51.1

Apr 2013

22

68

10

51.2

Mar 2013

26

68

6

55.9

Backlog of Orders

ISM's Non-Manufacturing Backlog of Orders Index registered 52 percent in June, which is 0.5 percentage point higher than the 51.5 percent that was reported in May. Of the total respondents in June, 40 percent indicated they do not measure backlog of orders.

The seven industries reporting an increase in order backlogs in June — listed in order — are:  Real Estate, Rental & Leasing; Retail Trade; Information; Finance & Insurance; Construction; Professional, Scientific & Technical Services; and Health Care & Social Assistance. The three industries reporting a decrease in order backlogs are: Other Services; Utilities; and Mining. Seven industries reported no change in order backlogs in June compared to May. 

Backlog of Orders

%Higher

%Same

%Lower

Index

Jun 2013

13

78

9

52.0

May 2013

14

75

11

51.5

Apr 2013

15

73

12

51.5

Mar 2013

18

73

9

54.5

New Export Orders

Orders and requests for services and other non-manufacturing activities to be provided outside of the United States by domestically based personnel contracted for the month of June. The New Export Orders Index for June registered 47.5 percent, which is 2.5 percentage points lower than the 50 percent reported in May. Of the total respondents in June, 65 percent indicated they either do not perform, or do not separately measure, orders for work outside of the United States.

The four industries reporting an increase in new export orders in June are: Construction; Transportation & Warehousing; Arts, Entertainment & Recreation; and Management of Companies & Support Services. The seven industries reporting a decrease in export orders in June — listed in order — are: Agriculture, Forestry, Fishing & Hunting; Professional, Scientific & Technical Services; Health Care & Social Assistance; Wholesale Trade; Finance & Insurance; Other Services; and Retail Trade. Six industries reported no change in new export orders for the month of June compared to May.

New Export Orders

%Higher

%Same

%Lower

Index

Jun 2013

16

63

21

47.5

May 2013

16

68

16

50.0

Apr 2013

22

63

15

53.5

Mar 2013

29

55

16

56.5

Imports

The ISM Non-Manufacturing Imports Index grew in June after a month of contraction. This month's reading at 53.5 percent is 4 percentage points higher than the 49.5 percent reported in May. Fifty-four percent of respondents reported that they do not use, or do not track the use of, imported materials.

The five industries reporting an increase in imports for the month of June are: Arts, Entertainment & Recreation; Information; Finance & Insurance; Wholesale Trade; and Professional, Scientific & Technical Services. The two industries reporting a decrease in imports for the month of June are: Other Services; and Agriculture, Forestry, Fishing & Hunting. Eleven industries reported no change in imports for the month of June compared to May.

Imports

%Higher

%Same

%Lower

Index

Jun 2013

11

85

4

53.5

May 2013

11

77

12

49.5

Apr 2013

20

77

3

58.5

Mar 2013

21

73

6

57.5

Inventory Sentiment

The ISM Non-Manufacturing Inventory Sentiment Index in June registered 61.5 percent, which is 1 percentage point lower than the 62.5 percent reported in May. This indicates that respondents believe their inventories are still too high at this time. In June, 27 percent of respondents said their inventories were too high, 4 percent said their inventories were too low, and 69 percent said their inventories were about right.

The 10 industries reporting a feeling that their inventories are too high in June — listed in order — are: Mining; Other Services; Agriculture, Forestry, Fishing & Hunting; Utilities; Finance & Insurance; Wholesale Trade; Information; Public Administration; Retail Trade; and Professional, Scientific & Technical Services. The two industries reporting a feeling that their inventories are too low in June are: Construction; and Health Care & Social Assistance.     

Inventory Sentiment

%Too High

%About Right

%Too Low

Index

Jun 2013

27

69

4

61.5

May 2013

30

65

5

62.5

Apr 2013

27

67

6

60.5

Mar 2013

24

71

5

59.5

About this Report

The data presented herein is obtained from a survey of non-manufacturing supply managers based on information they have collected within their respective organizations. ISM makes no representation, other than that stated within this release, regarding the individual company data collection procedures. Use of the data is in the public domain and should be compared to all other economic data sources when used in decision-making.

Data and Method of Presentation

The Non-Manufacturing ISM Report On Business® is based on data compiled from purchasing and supply executives nationwide. Membership of the Non-Manufacturing Business Survey Committee is diversified by NAICS, based on each industry's contribution to gross domestic product (GDP). The Non-Manufacturing Business Survey Committee responses are divided into the following NAICS code categories: Agriculture, Forestry, Fishing & Hunting; Mining; Utilities; Construction; Wholesale Trade; Retail Trade; Transportation & Warehousing; Information; Finance & Insurance; Real Estate, Rental & Leasing; Professional, Scientific & Technical Services; Management of Companies & Support Services; Educational Services; Health Care & Social Assistance; Arts, Entertainment & Recreation; Accommodation & Food Services; Public Administration; and Other Services (services such as Equipment & Machinery Repairing; Promoting or Administering Religious Activities; Grantmaking; Advocacy; and Providing Dry-Cleaning & Laundry Services, Personal Care Services, Death Care Services, Pet Care Services, Photofinishing Services, Temporary Parking Services, and Dating Services).

Survey responses reflect the change, if any, in the current month compared to the previous month. For each of the indicators measured (Business Activity, New Orders, Backlog of Orders, New Export Orders, Inventory Change, Inventory Sentiment, Imports, Prices, Employment and Supplier Deliveries), this report shows the percentage reporting each response, and the diffusion index. Responses represent raw data and are never changed. Data is seasonally adjusted for Business Activity, New Orders, Prices and Employment. All seasonal adjustment factors are supplied by the U.S. Department of Commerce and are subject annually to relatively minor changes when conditions warrant them. The remaining indexes have not indicated significant seasonality.

The NMI (Non-Manufacturing Index) is a composite index based on the diffusion indexes for four of the indicators with equal weights: Business Activity (seasonally adjusted), New Orders (seasonally adjusted), Employment (seasonally adjusted) and Supplier Deliveries. Diffusion indexes have the properties of leading indicators and are convenient summary measures showing the prevailing direction of change and the scope of change. An index reading above 50 percent indicates that the non-manufacturing economy in that index is generally expanding; below 50 percent indicates that it is generally declining. Supplier Deliveries is an exception. A Supplier Deliveries Index above 50 percent indicates slower deliveries and below 50 percent indicates faster deliveries.

The Non-Manufacturing ISM Report On Business® survey is sent out to Non-Manufacturing Business Survey Committee respondents the first part of each month. Respondents are asked to ONLY report on information for the current month. ISM receives survey responses throughout most of any given month, with the majority of respondents generally waiting until late in the month to submit responses in order to give the most accurate picture of current business activity. ISM then compiles the report for release on the third business day of the following month.

The industries reporting growth, as indicated in the Non-Manufacturing ISM Report On Business® monthly report, are listed in the order of most growth to least growth. For the industries reporting contraction or decreases, those are listed in the order of the highest level of contraction/decrease to the least level of contraction/decrease.

The Non-Manufacturing ISM Report On Business® is published monthly by the Institute for Supply Management, the first supply institute in the world. Founded in 1915, ISM exists to lead and serve the supply management profession and is a highly influential and respected association in the global marketplace. ISM's mission is to enhance the value and performance of procurement and supply chain management practitioners and their organizations worldwide. 

The full text version of the Non-Manufacturing ISM Report On Business® is posted on ISM's website at www.ism.ws on the third business day of every month after 10:10 a.m. (ET).

The next Non-Manufacturing ISM Report On Business® featuring the July 2013 data will be released at 10:00 a.m. (ET) on Monday, August 5, 2013.

Contact:

Rose Marie Goupil


ISM, ROB Media Relations


Tempe, Arizona


(800) 888-6276, Ext. 3015


E-mail: rgoupil@ism.ws

(Logo:  http://photos.prnewswire.com/prnh/20121101/LA02871LOGO)

SOURCE Institute for Supply Management




Custom Packages

Browse our custom packages or build your own to meet your unique communications needs.

Start today.

 

PR Newswire Membership

Fill out a PR Newswire membership form or contact us at (888) 776-0942.

Learn about PR Newswire services

Request more information about PR Newswire products and services or call us at (888) 776-0942.