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The ISM® (Institute for Supply Management®) Manufacturing PMI® reported in at 42.7% for August, up 0.4 percentage points from the previous month. Manufacturing activity remained sluggish; of the six largest manufacturing industries, only Food, Beverage & Tobacco Products and Computer & Electronic Products registered growth last month. The forward-looking new orders sub-index decreased 2.8 percentage points to 44.6%. The Prices Index which measures what companies pay for raw materials and other supplies, increased 1.1 percentage points to 54.0%, increasing for the eighth straight month. The Employment Index increased by 2.6 percentage points to 50.5%, the fourth lowest since July 2020. The Backlog of Orders Index increased 1.9 percentage points to 43.6% and has now contracted for the twenty-third consecutive month.
The ISM® (Institute for Supply Management®) Services PMI® reported in at 51.5% for August, 0.1 percentage point higher than the previous month. August’s reading is the sixth time the index has been in expansion in 2024. The Business Activity Index decreased 1.2 percentage points to 53.3%. The New Orders Index increased to 53%, up 0.6 percentage points, showing expansion for the 2nd consecutive month. For the 87th consecutive month, services businesses had to pay higher prices for goods and services, as the Prices Index increased 0.3 percentage points to 57.3%. Employment activity indicated growth for the second consecutive month, as the Employment Index registered 50.2% down 0.9 percentage points from July. The Backlog of Orders Index declined 6.9 percentage points to 43.7%, marking the lowest reading since August 2023.
The U.S. Bureau of Labor Statistics reported 142,000 jobs were added as the unemployment rate change little to 4.2% in August. The number of unemployed changed little to 7.1M. A year earlier, the unemployment rate was 3.8%, and the number of unemployed was 6.3M. Job gains occurred in health care (+31,000) and construction (+34,000). Among the unemployed, the number of permanent job losers had little change with 1.7M. The labor force participation remained at 62.7% and has had little change over the year. Average hourly earnings grew 0.4%. At $35.21 average hourly earnings are up 3.8% from a year ago.
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