#None #Economic Growth #ISM Services PMI #Services Sector

Continued Growth in Services Sector

The recent report from the Institute for Supply Management® (ISM®) reveals that the services sector of the U.S. economy continues to show resilience. In September 2026, the Services PMI® registered at 54.9%, marking the 27th month of continuous expansion. This latest figure, though a slight decrease from August’s 55.4%, indicates ongoing growth in various service industries, revealing a dynamic economy.

Steve Miller, the Chair of the ISM® Services Business Survey Committee, emphasized the importance of these numbers. He pointed out that while there’s a small decline, the index remains firmly in expansion territory. The Business Activity Index registered 56.5%, down from 61.7% the previous month but still indicating growth. Overall, the economic activity is consistent with the current trends where services are a significant contributor to the GDP.

Key Figures from the Report

• - Business Activity Index: 56.5% (down from 61.7% in August)
• - New Orders Index: 59.8% (down from 60.9% in August)
• - Employment Index: 50.1% (up from 47.8% in August)
• - Supplier Deliveries Index: 53.2% (up from 51.3% in August)
• - Prices Index: 74% (up from 72.6% in August)

The New Orders Index, which plays a crucial role in predicting near-future services activity, dipped slightly to 59.8%. This indicates a continued demand for services despite a modest decline. The Employment Index, showing a growth rate of 50.1%, suggests that hiring in the services sector has stabilized after a brief contraction period. This is a critical signal for prospective job seekers and job creation.

Inflation and Pricing Trends

One noteworthy aspect of the report is the Prices Index, climbing to 74%, which signifies increasing costs within the services sector. This index level has now been above 70% for six of the last seven months, indicating a sustained increase in prices. Industries such as Transportation, Warehousing, and Health Care are experiencing elevated costs attributed to ongoing supply chain disruptions and inflationary pressures.

Supply Chain and Employment Insights

Moreover, the Supplier Deliveries Index has remained in expansion territory for 22 consecutive months, indicating slower delivery times which continue to be a significant challenge for businesses. Comments from industry respondents reveal major concerns about supply chain constraints, with tariffs and fuel costs being predominant issues affecting performance.

Employment data suggest a shifting paradigm, as businesses ramp up hiring initiatives due to increasing backlogs of order. Several industries noted that they are actively looking to fill positions vacated by employees moving up within their organizations due to high demand and subsequent promotions.

Performance Across Industries

Thirteen industries reported growth in September, including significant sectors such as Wholesale Trade, Real Estate, and Public Administration. In contrast, Agriculture, Construction, and Mining were among the sectors experiencing contraction, underlining the varied landscape of the service economy.

In sum, while the ISM® Services PMI® for September reflects a slight dip compared to August, the overall impression of the report reveals a robust services sector with ample opportunities for growth and employment. The report suggests a steady economy, underscored by vibrant activity in service-related industries that continues to shape broader economic health—a vital indicator as we move into the final quarter of 2026.