Service Sector Slump
The latest casualty in the aftermath of hurricanes Rita and Katrina appears to be the economy's service industry sector, which reportedly grew at the slowest pace in more than two years last month.
The back-to-back hurricanes closed Gulf Coast businesses and raised prices for supplies and materials to record hights.
According to the Institute for Supply Management, its measure of financial services, retail trade and other non-manufacturing businesses plummeted to 53.3, the lowest level since April 2003, from 65 in August. The decline was the greatest since the measure, which deals with 87 percent of the economy, was instituted eight years ago.
"Service companies are clearly looking at the low readings on consumer confidence and are scaling back their expectations for growth this year," Chris Rupkey, senior financial economist at Bank of Tokyo-Mitsubishi Ltd., was quoted as saying.
By Glenn J. Kalinoski, Executive Editor, Customer Inter@ction Solutions
Related Tags: service
- Related Entries
Technorati
Del.icio.us
Slashdot
Digg
Furl
Spurl
Listed below are links to sites that reference Service Sector Slump:
Trackback Pings
TrackBack URL for Service Sector Slump:
http://blog.tmcnet.com/mt3/t.fcgi/17246
Previous blog:
Postal Service Looking for FeedbackBusiness Intelligence Watch Home Page
Next blog:
Cost of Doing Business Increasing
RE: Service Sector Slump
JC Ernharth :
October 6, 2005 3:16 PM
The tie in is the credit markets and low rates. Life support was injected into this economy over the last few years, and your service sectors -- like banks, mort*gage lenders, brokerages -- all did really well. But it was artificially created to begin with. Expect them to give up much as it all unwinds.
Moreover, you need to look at the offshoring of these jobs -- happening at an ever greater pace. I just read in the WSJ last week that Lawyers are even getting offshored to India. Good for those SOB's given that they are behind most of teh rules and regulations that are clogging our economy to a standstill, and among the few benefitting from the excessive costs required by our businesses to comply.