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To: SusieQ1065 who wrote (13171)	8/5/2002 4:26:32 PM
From: MulhollandDrive	Read Replies (1) \| Respond to of 17639

<service sector showing signs of stalling out> upi.com Key index show service sector growth slow From the Business & Economics Desk Published 8/5/2002 2:03 PM View printer-friendly version TEMPE, Ariz., Aug. 5 (UPI) -- The U.S. service sector grew at a slower pace than expected, according to the Institute of Supply Management, which publishes several key indexes of activity by the nation's purchasing and supply executives. The ISM's retail index -- the Non-Manufacturing Business Survey -- showed that while service sector activity continues to expand, it did so at a markedly slowed pace, falling to a growth rate of 53.1 percent for July from 57.2 percent in June. Anything number above the 50 percent baseline represents growth and anything under indicates economic contraction. "In July, non-manufacturing business activity increased at a slower rate than in June. The reported growth represents the sixth consecutive month of expansion in non-manufacturing business activity, but the second consecutive month of reduced rates of expansion," said Ralph Kauffman, head of the ISM survey committee, and a certified public accountant and business professor. "Also in July, New Orders grew at a slower rate than in June, and the Backlog of Orders Index indicated smaller backlogs than in June," Kauffman added. Reports from purchasing and supply executives surveyed indicate nine industry groups grew in July, six groups contracted, and two groups indicated no change. Increased business activity in July was reported by 25 percent of members, compared to June's 35 percent. Reduced activity was reported by 21 percent of members compared to 15 percent in June. In July, the remaining 54 percent of members indicated no change in business activity compared to 50 percent in June. The overall sense of how members currently assess the business climate is reflected in one member's comment, "While the economy continues to show signs of improvement, overall outlook remains cautious through year-end." Other comments cited negative effects of national economic bad news, but some members indicated that business was either holding its own or increasing. July's service sector index of 53.1 confirms that more service businesses are reporting growth than contraction, but the drop in the index from 57.2 percent in June means that July's rate of growth was less substantial. The ISM also published an influential monthly report on manufacturing activity, which is closely followed by the markets and the Federal Reserve, in tracking the economy. Copyright © 2002 United Press International