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NMI® at 57.6%; December Non-Manufacturing ISM® Report On Business®Business Activity Index at 59.9%; New Orders Index at 62.7%; Employment Index at 56.3% TEMPE, Ariz., Jan. 7, 2019 /PRNewswire/ -- Economic activity in the non-manufacturing sector grew in December for the 107th 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, CPSM, C.P.M., A.P.P., CFPM, Chair of the Institute for Supply Management® (ISM®) Non-Manufacturing Business Survey Committee: "The NMI® registered 57.6 percent, which is 3.1 percentage points lower than the November reading of 60.7 percent. This represents continued growth in the non-manufacturing sector, at a slower rate. The Non-Manufacturing Business Activity Index decreased to 59.9 percent, 5.3 percentage points lower than the November reading of 65.2 percent, reflecting growth for the 113th consecutive month, at a slower rate in December. The New Orders Index registered 62.7 percent, 0.2 percentage point higher than the reading of 62.5 percent in November. The Employment Index decreased 2.1 percentage points in December to 56.3 percent from the November reading of 58.4 percent. The Prices Index decreased 6.7 percentage points from the November reading of 64.3 percent to 57.6 percent, indicating that prices increased in December for the 34th consecutive month. According to the NMI®, 16 non-manufacturing industries reported growth. The non-manufacturing sector's growth rate cooled off in December. Respondents indicate that there still is concern about tariffs, despite the hold on increases by the U.S. and China. Also, comments reflect that capacity constraints have lessened; however, employment-resource challenges remain. Respondents are mostly optimistic about overall business conditions." INDUSTRY PERFORMANCE WHAT RESPONDENTS ARE SAYING
*Non-Manufacturing ISM® Report On Business® data is seasonally adjusted for the Business Activity, New Orders, Prices and Employment Indexes. Manufacturing ISM® Report On Business® data is seasonally adjusted for New Orders, Production, Employment and Supplier Deliveries Indexes. COMMODITIES REPORTED UP/DOWN IN PRICE, AND IN SHORT SUPPLY Commodities Up in Price Commodities Down in Price Commodities in Short Supply Note: The number of consecutive months the commodity is listed is indicated after each item. DECEMBER 2018 NON-MANUFACTURING INDEX SUMMARIES NMI® An NMI® above 49 percent, over a period of time, generally indicates an expansion of the overall economy. Therefore, the December NMI® indicates growth for the 112th consecutive month in the overall economy and expansion in the non-manufacturing sector for the 107th consecutive month. Nieves says, "The past relationship between the NMI® and the overall economy indicates that the NMI® for December (57.6 percent) corresponds to a 3.2-percent increase in real gross domestic product (GDP) on an annualized basis." NMI® HISTORY
Business Activity The 11 industries reporting growth of business activity in December — listed in order — are: Arts, Entertainment & Recreation; Retail Trade; Transportation & Warehousing; Finance & Insurance; Utilities; Health Care & Social Assistance; Information; Public Administration; Accommodation & Food Services; Other Services; and Professional, Scientific & Technical Services. The four industries reporting a decrease in December are: Mining; Real Estate, Rental & Leasing; Management of Companies & Support Services; and Wholesale Trade.
New Orders The 13 industries reporting growth of new orders in December — listed in order — are: Arts, Entertainment & Recreation; Utilities; Transportation & Warehousing; Information; Health Care & Social Assistance; Professional, Scientific & Technical Services; Wholesale Trade; Retail Trade; Finance & Insurance; Other Services; Public Administration; Accommodation & Food Services; and Management of Companies & Support Services. The only industry reporting a decrease in December is Mining.
Employment The 13 industries reporting an increase in employment in December — listed in order — are: Real Estate, Rental & Leasing; Transportation & Warehousing; Retail Trade; Educational Services; Management of Companies & Support Services; Health Care & Social Assistance; Accommodation & Food Services; Other Services; Public Administration; Wholesale Trade; Professional, Scientific & Technical Services; Information; and Finance & Insurance. The four industries reporting a reduction in employment in December are: Construction; Mining; Utilities; and Arts, Entertainment & Recreation.
Supplier Deliveries The eight industries reporting slower deliveries in December — listed in order — are: Arts, Entertainment & Recreation; Agriculture, Forestry, Fishing & Hunting; Construction; Health Care & Social Assistance; Accommodation & Food Services; Professional, Scientific & Technical Services; Public Administration; and Management of Companies & Support Services. The six industries reporting faster deliveries in December — listed in order — are: Real Estate, Rental & Leasing; Utilities; Retail Trade; Finance & Insurance; Information; and Other Services.
Inventories The eight industries reporting an increase in inventories in December — listed in order — are: Real Estate, Rental & Leasing; Retail Trade; Agriculture, Forestry, Fishing & Hunting; Accommodation & Food Services; Other Services; Public Administration; Utilities; and Finance & Insurance. The eight industries reporting a decrease in inventories — listed in order — are: Arts, Entertainment & Recreation; Information; Mining; Construction; Wholesale Trade; Health Care & Social Assistance; Professional, Scientific & Technical Services; and Management of Companies & Support Services.
Prices Ten non-manufacturing industries reporting an increase in prices paid during the month of December, listed in the following order are: Transportation & Warehousing; Information; Construction; Accommodation & Food Services; Real Estate, Rental & Leasing; Wholesale Trade; Public Administration; Mining; Management of Companies & Support Services; and Health Care & Social Assistance. Six industries reported no change in prices.
NOTE: Commodities reported as up in price and down in price are listed in the commodities section of this report. Backlog of Orders The seven industries reporting an increase in order backlogs in December — listed in order — are: Retail Trade; Transportation & Warehousing; Health Care & Social Assistance; Accommodation & Food Services; Construction; Professional, Scientific & Technical Services; and Public Administration. The seven industries that reported a decrease in backlogs — listed in order — are: Real Estate, Rental & Leasing; Management of Companies & Support Services; Wholesale Trade; Other Services; Information; Utilities; and Mining.
New Export Orders The eight industries reporting an increase in new export orders in December — listed in order — are: Accommodation & Food Services; Agriculture, Forestry, Fishing & Hunting; Real Estate, Rental & Leasing; Information; Retail Trade; Professional, Scientific & Technical Services; Wholesale Trade; and Construction. The two industries reporting a decrease in exports for the month of December are: Mining; and Other Services. Six industries reported no change in December.
Imports The eight industries reporting an increase in imports for the month of December — listed in order — are: Real Estate, Rental & Leasing; Management of Companies & Support Services; Information; Finance & Insurance; Accommodation & Food Services; Transportation & Warehousing; Health Care & Social Assistance; and Wholesale Trade. The three industries reporting a decrease in imports in the month of December are: Other Services; Construction; and Agriculture, Forestry, Fishing & Hunting. Six industries reported no change in December.
Inventory Sentiment The 12 industries reporting a feeling that their inventories were too high in December — listed in order — are: Wholesale Trade; Management of Companies & Support Services; Mining; Real Estate, Rental & Leasing; Agriculture, Forestry, Fishing & Hunting; Utilities; Information; Construction; Retail Trade; Public Administration; Health Care & Social Assistance; and Other Services. The only industry reporting a feeling that their inventories were too low in December is Transportation & Warehousing.
About This Report The data presented herein is obtained from a survey of non-manufacturing supply executives 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. The data should be compared to all other economic data sources when used in decision-making. Data and Method of Presentation 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 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 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. An NMI® above 49 percent, over a period of time, indicates that the overall economy, or gross domestic product (GDP), is generally expanding; below 49 percent, it is generally declining. The distance from 50 percent or 49 percent is indicative of the strength of the expansion or decline. 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. ISM ROB Content Except as explicitly and expressly permitted by ISM, you are strictly prohibited from creating works or materials (including, but not limited to: tables, charts, data streams, time-series variables, fonts, icons, link buttons, wallpaper, desktop themes, online postcards, montages, mashups and similar videos, greeting cards, and unlicensed merchandise) that derive from or are based on the ISM ROB Content. This prohibition applies regardless of whether the derivative works or materials are sold, bartered, or given away. 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Elliot Road, Suite 113, Tempe, AZ 85284-1556, or by emailing [email protected]; subject: Content Request. ISM shall not have any liability, duty, or obligation for or relating to the ISM ROB Content or other information contained herein, any errors, inaccuracies, omissions or delays in providing any ISM ROB Content, or for any actions taken in reliance thereon. In no event shall ISM be liable for any special, incidental, or consequential damages, arising out of the use of the ISM ROB. Report On Business®, PMI®, and NMI® are registered trademarks of Institute for Supply Management®. Institute for Supply Management® and ISM® are registered trademarks of Institute for Supply Management, Inc. About Institute for Supply Management® The full text version of the Non-Manufacturing ISM® Report On Business® is posted on ISM®'s website at www.ismrob.org on the third business day* of every month after 10:00 a.m. ET. The next Non-Manufacturing ISM® Report On Business® featuring the January 2019 data will be released at 10:00 a.m. ET on Tuesday, February 5, 2019. *Unless the New York Stock Exchange is closed.
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