ISM Non-Manufacturing Index: The Institute for Supply Management’s non-manufacturing index increased by 0.1 points month on month (+0.2% m/m) to 51.5 in August 2024.

The ISM non-manufacturing survey measures the rate and direction of change in activity in non-manufacturing industries. Surveys are sent to more than 400 purchasing managers in 18 industries. Survey responses reflect the change in the current month compared with the previous month. A value of 50 is neutral, while less than 50 denotes contracting non-manufacturing activity and greater than 50 denotes expanding activity.

Figure 1 breaks down the composite index and sub-indexes. The business activity sub-index was 53.3, while the imports sub-index was 50.3.

The 10 services industries reporting growth in August — listed in order — are: Arts, Entertainment & Recreation; Mining; Transportation & Warehousing; Other Services; Information; Health Care & Social Assistance; Finance & Insurance; Public Administration; Educational Services; and Utilities. The seven industries reporting a decrease in the month of August — listed in order — are: Agriculture, Forestry, Fishing & Hunting; Retail Trade; Construction; Wholesale Trade; Accommodation & Food Services; Management of Companies & Support Services; and Professional, Scientific & Technical Services.

“Housing market continues to be dampened by higher borrowing costs. All segments of the industry are affected. Single-family homes for sale, build for rent, and multifamily units are all feeling the effects.” [Construction]

At Gerdau, we closely monitor the ISM non-manufacturing index since it is an excellent barometer of the present strength, as well as a window on the likely short-run future, of the U.S. non-manufacturing economy. We have seen that a strengthening non-manufacturing economy translates to improved steel consumption.