The ISM Services Index registered 52.7%, 1.2 percentage points decrease than June’s reading of 53.9%. The composite index indicated growth in July for the seventh consecutive month after a reading of 49.2% in December, the first contraction since June 2020 (45.4%)
“Fourteen industries reported growth in July. The Services PMI®, by being above 50 percent for the seventh month after a single month of contraction and a prior 30-month period of expansion, continues to indicate sustained growth for the sector. The composite index has indicated expansion for all but three of the previous 161 months.”
The Business Activity Index registered 57.1%, a 2.1 percentage point decrease compared to the reading of 59.2% in June.
The employment Index registered 50.7%, down 2.4 percentage points from the June figure of 53.1%. Comments from respondents include: “Not replacing turnover on production teams; matching capacity to lower demand” and “Have a need but cannot recruit fast enough.” Also: “We are hiring but also losing employees to other firms that offer higher compensation.”
The New Orders Index registered 55%, 0.5 percentage point lower than the June reading of 55.5%. The index indicated expansion for the seventh consecutive month after contracting in December, ending a string of 30 consecutive months of growth. Comments from respondents include: “New fiscal year spending and preparation for the school year” and “Increased CapEx (capital expenditures) spend.”
The Supplier Deliveries Index registered 48.1%, up 0.5 percentage point from the 47.6% recorded in June. A reading above 50% indicates slower deliveries, while a reading below 50% indicates faster deliveries. The July reading indicates supplier deliveries are faster. Comments from respondents include: “Backlog at suppliers lower, with measured production and transportation availability” and “Better lead times, less supply constraints.”
Read the ISM release.
