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U.S. Economy’s Services Sector Growth Slows Sharply
The services sector of the U.S. economy slowed sharply in September, recording its lowest reading in three years. The latest report by the Institute for Supply Management (ISM) showed the non-manufacturing index sank to 52.6 from 56.4 in August. Readings above 50 signal growth, though September’s numbers are the lowest they’ve’ been since August 2016.
The services sector slowdown is closely watched, since the category accounts for more than two-thirds of economic activity in the U.S. Economists note the drop comes at a time when a trade war between the U.S. and China has pressured American manufacturers. Until now, the sector had withstood the storm, though slower global growth coupled with trade tensions and a cloudier future finally could be catching up.
ISM reported weaker sales, new orders and employment numbers last month. Companies surveyed indicated concerns about tariffs. Economists are especially concerned about the ISM’s employment measure index dropping from 53.1 to 50.4, the lowest point it has been since February 2014.
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- ◦Economy
