The U.S. services sector is growing at a record pace.
Why it matters: Labor shortages and supply chain issues have hindered business activity across sectors, but not so much that businesses aren’t able to grow at a high clip.
By the numbers: The ISM services PMI, an index that tracks activity in nonmanufacturing industries, jumped to a record high 64.1 in July from 60.1 in June.
- All 17 services industries reported growth in July.
- The employment index rose to 53.8 from 49.3 in the prior month, which suggests hiring conditions are improving.
- However, the supplier deliveries index climbed to 72.0 from 68.5, meaning it’s taking longer on average for vendors to get supplies to their customers.
- Also, the prices paid index increased to 82.3 from 79.5, which means inflation.
The big picture: "Rising case counts and the particularly virulent Delta variant are threatening to disrupt the recreation renaissance we have been counting on to drive a services spending boom this summer," Wells Fargo’s Sarah House wrote. "Through July at least, the service sector is still cranking at full throttle."