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US service sector growth reaches new heights in November | WGN Radio 720

File – Friday, April 16, 2021, patrons will be assisted while dining along the sidewalk of Franklin Street in Chapel Hill, North Carolina. Growth in the service sector, where most Americans work, hit a record high in November. Set in October. (AP Photo / Jerry Bloom, File)

Washington (AP) — The growth of the services sector, where most Americans work, hit a record high in November, surpassing the record set last month.

The Supply Chain Management Association reported on Friday that a monthly survey of the service industry increased by 2.4 percentage points in November from the October record to a measurement of 69.1 percent. Reads above 50 indicate growth.

Data from the services sector were released in the wake of the seemingly slowing employment situation in November, but the unemployment rate fell from 4.6% to 4.2%. This is historically low unemployment, but still above the pre-pandemic level of 3.5%.

Part of the strength of the service sector lies in supply chain issues that make it difficult to meet growing demand. These issues are manifested in the index as extended delivery times and rising prices for suppliers registered as a strength of the service sector.

The recent increase in COVID-19 cases and the emergence of new Omicron variants may curb activity in the service sector in the coming months.

Paul Ashworth, Chief US Economist at Capital Economics, said:

The November increase was driven by a rise in the business activity index and a rise in the employment index. The new order index remained high at 69.7.

The overall index has been for 18 consecutive months since all 18 service sectors reported growth in November and recorded a two-month contraction in April and May last year when the pandemic raged. I grew up in.

Anthony Nieves, head of the ISM Services Division Investigation Commission, said the responses to the November report were collected before the report on the new Omicron variant was published. He said the new variant could affect the activities of the service sector, depending on how widespread the new variant is and how much it increases infection.

Responses from companies in the service sector have shown that supply chain delays and difficulty in finding workers have widespread implications.

A survey respondent in the food service industry pointed out that “labor shortages, transportation delays, and supply constraints” were major problems.

“Even if Omicron does not prove to be a significant threat, substantive supply-side restraints will continue to curb expansion,” said Oren Krachen, head of U.S. economist at Oxford Economics. ..

US service sector growth reaches new heights in November | WGN Radio 720

Source link US service sector growth reaches new heights in November | WGN Radio 720

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