The following is the un-edited press release from the Institute for Supply Management.


TOP PERFORMING INDUSTRIES

The nine industries reporting growth in February — listed in order — are: Other Services; Health Care & Social Assistance; Professional, Scientific & Technical Services; Educational Services; Utilities; Transportation & Warehousing; Real Estate, Rental & Leasing; Accommodation & Food Services; and Information. The nine industries reporting decreased activity from January to February are: Mining; Agriculture, Forestry, Fishing & Hunting; Arts, Entertainment & Recreation; Construction; Retail Trade; Management of Companies & Support Services; Public Administration; Finance & Insurance; and Wholesale Trade.

WHAT RESPONDENTS ARE SAYING ...

""""Cautious optimism for continued growth albeit at a slower pace than 2006."""" (Finance & Insurance)
Business markets for professional services are flat from the prior month due to economic and political uncertainty globally. Travel-related services continue to be a challenge due to short supply."""" (Professional, Scientific & Technical Services)
""""There seems to be a settling taking place with prices and vendor performance."""" (Retail Trade)
""""Encouraged by economic indicators."""" (Educational Services)
""""Discretionary consumer business contracting overall, growing in highly differentiated and personalized offerings."""" (Accommodation & Food Services)

FEBRUARY 2007 NON-MANUFACTURING INDEX SUMMARIES
Business Activity

ISM''s Non-Manufacturing Business Activity Index in February registered 54.3% compared to the seasonally adjusted 59% registered in January, indicating a slower rate of growth in business activity in February. The implication is that non-manufacturing business activity is continuing to increase for the 47th consecutive month. Nine industries reported increased business activity, and nine reported decreased activity for the month of February.

The industries reporting growth of business activity in February are: Other Services; Health Care & Social Assistance; Professional, Scientific & Technical Services; Educational Services; Utilities; Transportation & Warehousing; Real Estate, Rental & Leasing; Accommodation & Food Services; and Information. The nine industries reporting contraction of business activity in February are: Mining; Agriculture, Forestry, Fishing & Hunting; Arts, Entertainment & Recreation; Construction; Retail Trade; Management of Companies & Support Services; Public Administration; Finance & Insurance; and Wholesale Trade.

New Orders

ISM''s Non-Manufacturing New Orders Index decreased to 54.8% in February from the seasonally adjusted 55.4 percent registered in January. This indicates continued expansion of new orders, but at a slower rate than in January. Comments from members include: """"Fewer leads or prospects""""; """"Concern over economy, energy prices, but most of all healthcare""""; and """"Decline in housing markets.""""

Industries reporting growth of new orders in February are: Other Services; Accommodation & Food Services; Transportation & Warehousing; Health Care & Social Assistance; Utilities; Professional, Scientific & Technical Services; Educational Services; and Public Administration. The industries reporting contraction of new orders in February are: Mining; Agriculture, Forestry, Fishing & Hunting; Management of Companies & Support Services; Arts, Entertainment & Recreation; Construction; Retail Trade; Real Estate, Rental & Leasing; Finance & Insurance; and Wholesale Trade.

Employment

Employment activity in the non-manufacturing sector increased at a faster rate in February compared to January. This was the 31st consecutive monthly increase in non-manufacturing employment. ISM''s Non-Manufacturing Employment Index for February is 52.2 percent, a 0.5 percentage point increase from the seasonally adjusted 51.7 percent reported in January. Seven industries reported increased employment, eight reported a decrease, and three indicated employment is unchanged from January. Comments from respondents include: """"Planned workforce reduction of 10 percent""""; """"Layoffs because of slowing sales""""; and """"Ramping for more upcoming work.""""

The industries reporting growth in employment in February are: Other Services; Transportation & Warehousing; Health Care & Social Assistance; Educational Services; Professional, Scientific & Technical Services; Public Administration; and Retail Trade. The eight industries reporting a reduction in employment in February are: Mining; Arts, Entertainment & Recreation; Construction; Real Estate, Rental & Leasing; Accommodation & Food Services; Finance & Insurance; Utilities; and Wholesale Trade.

Supplier Deliveries

In February, the delivery performance of suppliers to non-manufacturing organizations was slower than in January. The index registered 52.5 percent, 1 percentage point lower than in January, indicating slowing at a slower rate. A reading above 50 percent indicates slower deliveries. Comments from purchasing and supply executives concerning supplier deliveries in February include: """"Delay in manufacturer supplies""""; """"Winter weather""""; and """"Worldwide demand is up.""""

The industries reporting slowing in supplier deliveries in February are: Other Services*; Wholesale Trade; Accommodation & Food Services; Professional, Scientific & Technical Services; Health Care & Social Assistance; and Public Administration. The four industries reporting faster supplier deliveries in February are: Agriculture, Forestry, Fishing & Hunting; Retail Trade; Finance & Insurance; and Utilities.

Inventories

ISM''s Non-Manufacturing Inventories Index registered 50.5 percent in February, an increase of 3.5 percentage points compared to January. Inventories are expanding after a one-month contraction. Of the total respondents in February, 33 percent indicated they do not have inventories or do not measure them. Comments from members include: """"Sales lower than forecast"""" and """"Increase of work and extended deliveries are requiring bigger inventory levels.""""