ISM Non-Manufacturing Survey – Mixed News
The composite index of the ISM Non-manufacturing Survey rose to 50.9 in September, the first reading above 50 since September 2008. Indexes tracking new orders (54.2 vs. 49.9 in August) and overall business activity (55.1 vs. 51.3) moved up in addition to indexes tracking backlogs, imports, and supplier deliveries.
The employment index increased to 44.3 in September from 43.5 in August, indicating that payrolls were falling less rapidly in September vs. August. In the short history of this survey, which goes back to 1997, the employment index tracks the change in payroll employment closely (see chart 2). The 2001 recovery (began in November 2001) was a “jobless recovery.” Payroll employment posted a meaningful increase only after mid-2003.
The manufacturing and non-manufacturing surveys for September included special questions to assess perceptions about the American Recovery and Reinvestment Act (ARRA, also known as the fiscal stimulus package of $787 billion). Of the respondents to the non-manufacturing survey, 44% indicated their industry would benefit, while the same percent of respondents also indicated that their company would gain from the program. The manufacturing survey results were different. In September, 30% of respondents of the manufacturing survey reported their industry would benefit from the fiscal stimulus package and 27% indicated that their company would gain from the expansionary fiscal policy package.
