ISM''s Non-Manufacturing New Orders Index decreased to 56.9 percent in June from the 57.4 percent registered in May. This indicates continued expansion of new orders but at a slower rate than in May. Comments from members include: """"New customer programs"""" and """"Slight seasonal increase.""""

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

Employment

Employment activity in the non-manufacturing sector increased at a slightly faster rate in June compared to May. This was the 35th consecutive monthly increase in non-manufacturing employment. ISM''s Non-Manufacturing Employment Index for June is 55 percent, a 0.1 percentage point increase from the 54.9 percent reported in May. Fourteen industries reported increased employment, two reported a decrease, and two indicated employment is unchanged from May. Comments from respondents include: """"More stores""""; """"Continued expansion of business""""; and """"Still hiring to support new projects.""""

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

Supplier Deliveries

In June, the delivery performance of suppliers to non-manufacturing organizations was slower than in May. The index registered 50.5 percent, 1 percentage point higher than in May. A reading above 50 percent indicates slower deliveries.

The industries reporting slowing in supplier deliveries in June are: Transportation & Warehousing; Educational Services; Public Administration; Utilities; Wholesale Trade; and Professional, Scientific & Technical Services. The industries reporting faster supplier deliveries in June are: Arts, Entertainment & Recreation; Construction; and Information.

Inventories

ISM''s Non-Manufacturing Inventories Index registered 52.5 percent in June, indicating that inventories are growing at slower rate compared to May. Inventories are expanding for the fifth consecutive month after one month of contraction in January 2007. Of the total respondents in June, 28 percent indicated they do not have inventories or do not measure them. Comments from members include: """"Reduced business levels""""; """"Planned constraints""""; and """"We are working very hard to reduce our inventory position and increase our turns.""""

The industries reporting increases in inventories in June are: Arts, Entertainment & Recreation; Retail Trade; Management of Companies & Support Services; Transportation & Warehousing; Utilities; Information; Finance & Insurance; Wholesale Trade; and Accommodation & Food Services. The industries reporting decreases in inventories in June are: Other Services; Professional, Scientific & Technical Services; Construction; and Health Care & Social Assistance.

Prices

Prices paid by non-manufacturing organizations for purchased materials and services increased in June for the 49th consecutive month. ISM''s Non-Manufacturing Prices Index for June is 65.5 percent, 0.9 percentage point lower than May''s index of 66.4 percent. In June, the percentage of respondents reporting higher prices decreased by 6 percentage points to 35 percent as compared to May. The percentage indicating no change increased from 55 percent in May to 62 percent in June. The percentage of respondents noting lower prices decreased by 1 percent to 3 percent in June.

The industries reporting an increase in prices paid in June are: Management of Companies & Support Services; Accommodation & Food Services; Real Estate, Rental & Leasing; Educational Services; Wholesale Trade; Arts, Entertainment & Recreation; Utilities; Finance & Insurance; Health Care & Social Assistance; Professional, Scientific & Technical Services; Retail Trade; Construction; and Public Administration. The one industry reporting a decrease in prices in June is Information.

Backlog of Orders

ISM''s Non-Manufacturing Backlog of Orders Index registered 46.5 percent in June, 1.5 percentage points lower than the 48 percent reported in May. Of the total respondents in June, 45 percent indicated they do not measure backlog of orders. Purchasing and supply executives'' comments include: """"Minimal new orders"""" and """"Eating up backlog.""""

The industries reporting an increase in order backlogs in June are: Transportation & Warehousing; Educational Services; Other Services*; Information; and Public Administration. The industries reporting lower backlog of orders in June are: Management of Companies & Support Services; Construction; Agriculture, Forestry, Fishing & Hunting; Wholesale Trade; Professional, Scientific & Technical Services; and Health Care & Social Assistance.

New Export Orders


Orders and requests for services and other non-manufacturing activities to be provided outside of the United States by domestically based personnel in June increased for the third consecutive month after a month of contraction. The New Export Orders Index for June is 59 percent, compared to May''s index of 66 percent. Of the total respondents in June, 73 percent indicated they either do not perform, or do not separately measure, orders for work outside of the United States.