Service Sector Slowdown
This morning, the ADP private-sector jobs reports showed all of the job growth was in the service sector which created 131,000 jobs in February. Unfortunately, despite the job growth, the sector itself saw a slight slowdown in February.
The Institute for Supply Management reported that its non-manufacturing activity index fell in February. (ISM)
– The index fell to a reading of 55.3 from 58.7 in January.
- A reading above 50 indicates growth in the services sector
It’s important to remember that January’s reading was the highest since February 2019.
Another important highlight from the report was the Prices Index figure of 71.8%. This was 7.6% higher than January, indicating that prices increased in February, and at a faster rate. Indicators like this are why many are worried about a surge in inflation when the economy does expand later this year.