*Number of months moving in current direction. Non-Manufacturing ISM® Report On Business® data is seasonally
adjusted for the Business Activity, New Orders, Prices and Employment Indexes.
ISM® REPORT ON BUSINESS®
NON-MANUFACTURING MAY 2017 Analysis by Anthony Nieves, CPSM, C. P. M., A.P.P., CFPM, Chair of the Institute for Supply Management® Non-Manufacturing Business
Economic activity in the non-manufacturing sector grew in May for the 89th consecutive month, say the nation’s purchasing and supply executives in the latest Non-Manufacturing ISM® Report On Business®.
The NMI® registered 56.9 percent.
The Non-Manufacturing Business
Activity Index decreased to 60.7
percent, 1. 7 percentage points
lower than the April reading of
62.4 percent, reflecting growth
for the 94th consecutive month,
at a slower rate in May. The New Orders Index registered
57.7 percent, 5. 5 percentage points lower than the reading
of 63.2 percent in April. The Employment Index increased
6. 4 percentage points in May to 57.8 percent from the April
reading of 51.4 percent. The Prices Index decreased 8. 4
percentage points from the April reading of 57.6 percent
to 49.2 percent. The majority of respondents’ comments
continue to indicate optimism about business conditions
and the overall economy. The 17 non-manufacturing
industries reporting growth in May — listed in order — are:
Real Estate, Rental & Leasing; Construction; Accommodation
& Food Services; Utilities; Arts,
Entertainment & Recreation;
Wholesale Trade; Mining;
Health Care & Social Assistance;
Management of Companies &
Support Services; Professional,
Scientific & Technical Services;
Agriculture, Forestry, Fishing & Hunting; Retail Trade;
Finance & Insurance; Public Administration; Transportation &
Warehousing; Information; and Other Services✣.
NON-MANUFACTURING AT A GLANCE
Index May Index Apr Index Point Change Direction Rate of Change Trend* (months)
NMI® 56.9 57.5 -0.6 Growing Slower 89
Business Activity 60.7 62.4 - 1. 7 Growing Slower 94
New Orders 57.7 63.2 - 5. 5 Growing Slower 94
Employment 57.8 51.4 + 6. 4 Growing Faster 39
Supplier Deliveries 51.5 53.0 - 1. 5 Slowing Slower 17
Inventories 54.0 52.5 + 1. 5 Growing Faster 2
Prices 49.2 57.6 - 8. 4 Decreasing FromIncreasing 1
Backlog of Orders 57.0 53.5 + 3. 5 Growing Faster 4
New Export Orders 54.5 65.5 - 11.0 Growing Slower 4
Imports 48.5 53.0 - 4. 5 Contracting From Growing 1
Inventory Sentiment 63.0 60.0 + 3.0 Too High Faster 240
OVERALL ECONOMY Growing Slower 94
Non-Manufacturing Sector Growing Slower 89
Commodities Up in Price: Beef ( 3); Construction; Construction Trades/Subcontractors; Corrugated Boxes; Diesel Fuel; #2 Diesel Fuel;
Food and Beverages; Gasoline* ( 3); Labor ( 2); Labor — Construction ( 3); Labor — Service; Labor — Temporary; Lettuce ( 3); Lumber ( 2);
Medical/Surgical Supplies; Ocean Freight; Plastic Products; Produce ( 2); Seafood; and Steel Products ( 6).
Commodities Down in Price: Bacon ( 2); Chicken; Fuel; Gasoline*; and Soy Products.
Commodities in Short Supply: Labor ( 4); Labor — Construction ( 14); Labor — Service; and Labor — Skilled.
Note: The number of consecutive months the commodity is listed is indicated after each item. *Reported as both up and down in price.
2017 2016 2015
48.9% = Non-Manufacturing Overall
Economy Breakeven Line
50% = Non-Manufacturing Economy
In May, the NMI® registered 56.9 percent, 0.6 percentage point lower than the 57.5
percent registered in April, indicating continued growth in the non-manufacturing
sector for the 89th consecutive month. 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. An NMI® above
48.9 percent, over a period of time, generally indicates an expansion of the overall
✣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).