The ISM Non-Manufacturing Index managed to end a two-month losing streak, moving back into expansionary territory in the latest month. The closely-followed survey that looks at the broad service sector increased from 48.7 in November to 50.1 in November but came up a little short of expectations.
Though above 50, the boundary that marks expansion and contraction, the survey suggests that the service sector was barely expanding at the end of the year. However, the overall trend continues to be in the right direction, despite recent sluggishness in the index.
The ISM survey shows that employment improved slightly but continues to lag, which is in contrast to November’s nonfarm payroll report, which showed the economy lost just 11,000 jobs.
Friday’s release of December nonfarm payrolls is expected to show that the economy gained 10,000 jobs in the final month of the year, according to Bloomberg. That’s a far cry from the number of jobs the economy needs to create in order to bring down the unemployment rate to more acceptable levels.
But given recent trends, we will probably see a respectable report within a couple of month, though upbeat numbers are likely to be sporadic until the recovery settles into a more sustainable, upward path.
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