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NMI (Non-Manufacturing Index) at 44%; May Non-Manufacturing ISM Report On Business®; Business Activity Index at 42.4%; New Orders Index at 44.4%; Employment Index at 39%

Dépèche transmise le 3 juin 2009 par Business Wire

TEMPE, Ariz.--(BUSINESS WIRE)--Economic activity in the non-manufacturing sector contracted in May, 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; and senior vice president — supply management for Hilton Hotels Corporation. “The NMI (Non-Manufacturing Index) registered 44 percent in May, 0.3 percentage point higher than the 43.7 percent registered in April, indicating contraction in the non-manufacturing sector for the eighth consecutive month, but at a slightly slower rate. The Non-Manufacturing Business Activity Index decreased 2.8 percentage points to 42.4 percent. The New Orders Index decreased 2.6 percentage points to 44.4 percent, and the Employment Index increased 2 percentage points to 39 percent. The Prices Index increased 6.9 percentage points to 46.9 percent in May, indicating a slower decrease in prices from April. According to the NMI, six non-manufacturing industries reported growth in May. Respondents’ comments remain mixed and vary by industry and company. Some respondents indicate that there are signs of stabilization, while others continue to have a negative outlook on the economy.”

INDUSTRY PERFORMANCE (Based on the NMI)

The six industries reporting growth in May based on the NMI composite index — listed in order — are: Real Estate, Rental & Leasing; Arts, Entertainment & Recreation; Utilities; Retail Trade; Construction; and Accommodation & Food Services. The 11 industries reporting contraction in May — listed in order — are: Other Services; Mining; Educational Services; Management of Companies & Support Services; Wholesale Trade; Finance & Insurance; Public Administration; Agriculture, Forestry, Fishing & Hunting; Transportation & Warehousing; Health Care & Social Assistance; and Information.

WHAT RESPONDENTS ARE SAYING …

• “Business remains strong despite the general economy.” (Health Care & Social Assistance)
• “Continued pressures in the financial services industry are driving spending and expense decisions across the sector.” (Finance & Insurance)
• “Our industry is in decline as we lag the general economy.” (Other Services)
• “Business activities are still weak due to the economic conditions in the country.” (Wholesale Trade)
• “Budget constraints continue due to the economy.” (Public Administration)
• “Input costs continue to decline. Supplier lead times are as low as I have ever seen them. Consumers are buying but trading down to lower cost, and for us unfortunately lower margin items.” (Agriculture, Forestry, Fishing & Hunting)

ISM NON-MANUFACTURING SURVEY RESULTS AT A GLANCE COMPARISON OF ISM NON-MANUFACTURING AND ISM MANUFACTURING SURVEYS(a) MAY 2009
Index		Non-Manufacturing													Manufacturing
	Series Index May		Series Index Apr.		Percent Point Change		Direction		Rate of Change		Trend(b) (Months)			Series Index May		Series Index Apr.		Percent Point Change
NMI/PMI		44.0		43.7		+0.3		Contracting		Slower		8			42.8		40.1		+2.7
Business Activity/ Production		42.4		45.2		-2.8		Contracting		Faster		8			46.0		40.4		+5.6
New Orders		44.4		47.0		-2.6		Contracting		Faster		8			51.1		47.2		+3.9
Employment		39.0		37.0		+2.0		Contracting		Slower		13			34.3		34.4		-0.1
Supplier Deliveries		50.0		45.5		+4.5		Unchanged		From Faster		1			49.8		44.9		+4.9
Inventories		47.0		43.0		+4.0		Contracting		Slower		9			32.9		33.6		-0.7
Prices		46.9		40.0		+6.9		Decreasing		Slower		7			43.5		32.0		+11.5
Backlog of Orders		40.0		44.0		-4.0		Contracting		Faster		10			48.0		40.5		+7.5
New Export Orders		47.0		48.5		-1.5		Contracting		Faster		7			48.0		44.0		+4.0
Imports		46.0		48.5		-2.5		Contracting		Faster		7			42.5		42.0		+0.5
Inventory Sentiment		62.5		62.5		0.0		Too High		Same		144			N/A		N/A		N/A
Customers’ Inventories		N/A		N/A		N/A		N/A		N/A		N/A			46.0		49.5		-3.5

(a) 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, Supplier Deliveries and Inventories.

(b) Number of months moving in current direction

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

Commodities Up in Price

Airfares; Copper Products; Dairy Products; #1 Diesel Fuel; #2 Diesel Fuel; Food & Beverage; Fuel; Gasoline (21); Medical Benefits/Care; Medical/Surgical Supplies; and Office/Computer Supplies.

Commodities Down in Price

Corrugated Products (4); Eggs; Natural Gas; Plastic Pipe/Fittings; Steel Products; Steel Pipe; and Steel Plate.

Commodities in Short Supply

Acetonitrile (5) and Surgical Masks are the only commodities reported in short supply.

Note: The number of consecutive months the commodity is listed is indicated after each item.

MAY 2009 NON-MANUFACTURING INDEX SUMMARIES

NMI (Non-Manufacturing Index)

In May, the NMI registered 44 percent, indicating contraction in the non-manufacturing sector at a slower rate compared to April’s reading of 43.7 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
					May 2009						44.0											Nov 2008						37.4
					Apr 2009						43.7											Oct 2008						44.6
					Mar 2009						40.8											Sep 2008						50.0
					Feb 2009						41.6											Aug 2008						50.4
					Jan 2009						42.9											Jul 2008						49.6
					Dec 2008						40.1											Jun 2008						48.8
					Average for 12 months – 44.5 High – 50.4 Low – 37.4

Business Activity

ISM’s Non-Manufacturing Business Activity Index in May registered 42.4 percent, a decrease of 2.8 percentage points when compared to the 45.2 percent registered in April. Six industries reported increased business activity, and 10 industries reported decreased activity for the month of May. Two industries reported no change from April. Comments from respondents include: “Many initiatives and plans on hold”; and “Delay in start date of new client projects.”

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

Business Activity						%Higher					%Same					%Lower					Index
May 2009						20					52					28					42.4
Apr 2009						26					46					28					45.2
Mar 2009						24					44					32					44.1
Feb 2009						18					42					40					40.2

New Orders

ISM’s Non-Manufacturing New Orders Index contracted in May for the eighth consecutive month. The index registered 44.4 percent, which is a decrease of 2.6 percentage points from the 47 percent registered in April. Comments from respondents include: “Slower business needs”; “Bids are reduced”; and “Capital purchasing has been curtailed.”

The 10 industries reporting growth of new orders in May — listed in order — are: Agriculture, Forestry, Fishing & Hunting; Real Estate, Rental & Leasing; Arts, Entertainment & Recreation; Utilities; Construction; Retail Trade; Information; Professional, Scientific & Technical Services; Accommodation & Food Services; and Health Care & Social Assistance. The eight industries reporting contraction of new orders in May — listed in order — are: Mining; Management of Companies & Support Services; Other Services; Finance & Insurance; Educational Services; Wholesale Trade; Transportation & Warehousing; and Public Administration.

New Orders						%Higher					%Same					%Lower					Index
May 2009						23					51					26					44.4
Apr 2009						24					54					22					47.0
Mar 2009						18					42					40					38.8
Feb 2009						16					47					37					40.7

Employment

Employment activity in the non-manufacturing sector contracted in May for the 16th time in the last 17 months. ISM’s Non-Manufacturing Employment Index for May registered 39 percent. This reflects an increase of 2 percentage points when compared to the 37 percent registered in April. Three industries reported increased employment, 12 industries reported decreased employment, and three industries reported unchanged employment compared to April. Comments from respondents include: “Layoffs and non-replacement of attrition continue to lower overall employee populations”; “Hired some line workers for small increase in business”; and “Properties beginning to add back staff to take care of increased demand.”

The industries reporting an increase in employment in May are: Arts, Entertainment & Recreation; Real Estate, Rental & Leasing; and Mining. The industries reporting a reduction in employment in May — listed in order — are: Educational Services; Public Administration; Other Services; Information; Transportation & Warehousing; Management of Companies & Support Services; Wholesale Trade; Construction; Finance & Insurance; Accommodation & Food Services; Health Care & Social Assistance; and Retail Trade.

Employment						%Higher					%Same					%Lower					Index
May 2009						13					58					29					39.0
Apr 2009						10					58					32					37.0
Mar 2009						7					50					43					32.3
Feb 2009						10					52					38					37.3

Supplier Deliveries

The Supplier Deliveries Index registered 50 percent in May, indicating no change from April (a reading at 50 percent indicates an equal balance of non-manufacturing respondents reporting slower and faster deliveries from suppliers). This is 4.5 percentage points more than the 45.5 percent reported in April. A reading above 50 percent indicates slower deliveries.

The four industries reporting slower supplier deliveries in May are: Educational Services; Transportation & Warehousing; Retail Trade; and Public Administration. The three industries reporting faster supplier deliveries in May are: Agriculture, Forestry, Fishing & Hunting; Mining; and Wholesale Trade.

Supplier Deliveries						%Slower					%Same					%Faster					Index
May 2009						7					86					7					50.0
Apr 2009						3					85					12					45.5
Mar 2009						7					82					11					48.0
Feb 2009						8					80					12					48.0

Inventories

ISM’s Non-Manufacturing Inventories Index registered 47 percent in May, indicating that inventory levels contracted in May for the ninth consecutive month. Of the total respondents in May, 26 percent indicated they do not have inventories or do not measure them. Comments from members include: “Reducing number of SKUs”; “Working down existing inventory”; and “Shorter lead times.”

The industries reporting an increase in inventories in May are: Arts, Entertainment & Recreation; Utilities; Real Estate, Rental & Leasing; Finance & Insurance; and Public Administration. The industries reporting decreases in inventories in May — listed in order — are: Agriculture, Forestry, Fishing & Hunting; Other Services; Mining; Retail Trade; Wholesale Trade; Transportation & Warehousing; Health Care & Social Assistance; Information; and Management of Companies & Support Services.

Inventories						%Higher					%Same					%Lower					Index
May 2009						17					60					23					47.0
Apr 2009						12					62					26					43.0
Mar 2009						9					62					29					40.0
Feb 2009						9					60					31					39.0

Prices

Prices paid by non-manufacturing organizations for purchased materials and services decreased in May for the seventh consecutive month after 65 consecutive months of increases. ISM’s Non-Manufacturing Prices Index for May registered 46.9 percent, 6.9 percentage points higher than the 40 percent reported in April. In May, the percentage of respondents reporting higher prices is 17 percent, the percentage indicating no change in prices paid is 68 percent, and 15 percent of the respondents reported lower prices.

In May, eight industries reported an increase in prices paid in the following order: Health Care & Social Assistance; Finance & Insurance; Construction; Arts, Entertainment & Recreation; Accommodation & Food Services; Public Administration; Utilities; and Professional, Scientific & Technical Services. The seven industries reporting prices as decreasing for the month of May — listed in order — are: Agriculture, Forestry, Fishing & Hunting; Mining; Retail Trade; Other Services; Management of Companies & Support Services; Information; and Wholesale Trade.

Prices						%Higher					%Same					%Lower					Index
May 2009						17					68					15					46.9
Apr 2009						9					70					21					40.0
Mar 2009						12					59					29					39.1
Feb 2009						18					57					25					48.1

Backlog of Orders

ISM’s Non-Manufacturing Backlog of Orders Index contracted in May for the 10th consecutive month. The index registered 40 percent, 4 percentage points lower than the 44 percent reported in April. Of the total respondents in May, 44 percent indicated they do not measure backlog of orders.

The only industry reporting an increase in order backlogs in May is Utilities. The 11 industries reporting lower backlog of orders in May — listed in order — are: Educational Services; Management of Companies & Support Services; Other Services; Mining; Agriculture, Forestry, Fishi