Economic Snapshot: Consecutive growth in employment, ISM indexes

Both the ADP employment report and the ISM manufacturing and non-manufacturing indexes are showing consistent growth, despite a small dip for the non-manufacturing index this month. All reports indicate solid expansion for their sectors and for employment as a whole. 

ADP employment report

Private sector employment added 230,000 jobs in October, which marks the seventh consecutive month of employment gains above 200,000 and the second highest reading in 2014. The increase in October was higher than the previous year, when 196,000 jobs were added.

Medium businesses gained the most jobs this month with 122,000, followed closely behind by small businesses with 102,000. Large businesses only added 5,000 jobs in October.

Service-providing jobs increased from September, adding 181,000 jobs compared to 176,000 last month. However, goods-producing jobs dipped slightly, adding 48,000 versus 50,000 in September, and manufacturers hired 15,000 jobs compared to 33,000 last month.

ISM manufacturing index

The ISM manufacturing index was at 59 percent in October, a 2.4 percent increase from September. This reading marks the 17th month of consecutive growth in the manufacturing sector and the 65th consecutive month of overall economic growth.

New orders registered at 65.8, climbing 5.8 percent from 60.0 last month, and the production index increased 0.2 percent from 64.6 to 64.8. The employment index grew for the 16th consecutive month, rising 0.9 percent to 55.5.

The prices index fell six percent this month, from 59.5 in September to 53.5. Twenty-one percent of respondents reported paying higher prices, 14 percent reported paying lower and 65 percent reported prices as unchanged.

Of the 18 manufacturing industries, 16 reported growth in October. The only industry reporting contraction is petroleum and coal products.

ISM non-manufacturing index

The ISM non-manufacturing index came in at 57.1 percent in October, down from 58.6 in September but the 57th month of consecutive growth in the sector.

Business activity decreased 2.9 percent this month to 60.0. New orders declined 1.9 percent in October to 59.1 and the prices index dropped 3.1 percentage points to 52.1. However, the employment index increased 1.1 percentage points to 59.6 this month.

Of the 18 non-manufacturing industries, 16 reported growth in October. The two industries reporting contraction are arts, entertainment and recreation and finance and insurance.