The answer may lie in the latest Institute for Supply Management (ISM) Non-Manufacturing Report , which shows continued expansion in September. While growth slightly moderated from August's record high, the sector's overall robustness continues to provide substantial support for sustained US economic growth.
Core Metric Analysis: NMI Index Shows Steady Expansion
The Non-Manufacturing Index (NMI), the ISM report's key indicator, registered 58.6 in September — a 1.0 percentage point decrease from August's 59.6 but still well above the 50-point threshold that separates expansion from contraction. Notably, August's NMI reading was the highest since the indicator's inclusion in the report in January 2008, making September's modest decline appear as normal fluctuation rather than a trend reversal.
Sustained Expansion: The Cornerstone of Economic Growth
ISM data reveals the non-manufacturing sector has now expanded for 56 consecutive months . This prolonged growth underscores the sector's critical role in the US economy. Encompassing healthcare, financial services, retail, hospitality, and other service industries, non-manufacturing constitutes a vital component of economic activity. Its persistent expansion demonstrates the economy's inherent resilience and capacity to withstand external shocks and uncertainties.
Deciphering NMI Components: Revealing Structural Economic Shifts
A deeper examination of NMI sub-indices — including business activity, new orders, employment, and supplier deliveries — provides valuable insights into the sector's dynamics. These components help identify growth drivers and potential vulnerabilities. For instance, rising new orders may signal continued expansion in coming months, while declining employment figures could indicate emerging labor market challenges.
Outlook: Navigating Future Uncertainties
The ISM report confirms the US non-manufacturing sector maintained solid growth momentum in September despite a modest deceleration. This ongoing expansion continues to underpin broader economic growth. However, global uncertainties — including trade tensions and geopolitical risks — may influence the sector's trajectory. Close monitoring of non-manufacturing performance remains essential for maintaining stable economic growth.