US services sector sees second recession in 3 months as economy slows – Xinhua

“The decline in the composite index in June was the result of significantly lower business activity, a second decline in new orders since May 2020 and a further decline in employment,” said Steve Miller, chairman of the ISM Services Business Survey Committee.

WASHINGTON, July 3 (Xinhua) — Economic activity in the U.S. services sector contracted in June for the second time in three months, indicating a slowdown in the economy, the Institute for Supply Management (ISM) said on Wednesday.

According to the latest ISM report on business activity in the services sector, the Purchasing Managers’ Index (PMI) stood at 48.8 percent, which is 5 percentage points lower than in May.

The services sector grew for 15 straight months after the December 2022 recession before posting a 49.4% contraction in April of this year. The June reading was a reversal from May and the second recessionary reading in the past three months.

“The decline in the composite index in June was the result of significantly lower business activity, a second decline in new orders since May 2020 and a further decline in employment,” said Steve Miller, chairman of the ISM Services Business Survey Committee.

The New Orders Index of 47.3 percent is 6.8 percentage points lower than the reading in May. The Employment Index contracted for the sixth time in seven months and at a faster pace in June; the reading of 46.1 percent is down 1 percentage point from May.

“Survey respondents say that overall, business is flat or down, and while inflation is declining, some goods are facing much higher costs,” Miller said. ■