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Activity in the U.S. services economy in May was stronger than at any time on record, according to the Institute for Supply Management (ISM).
The ISM’s services activity index rose from 62.7 in April to 64.0 last month, its highest level ever, the ISM said.
Any rating above 50 indicates expansion; the higher the number, the faster the growth.
All 18 service industries surveyed reported growth.
Demand for services rose sharply in May in tandem with the number of U.S. adults fully vaccinated against the COVID virus, a number spiking from 39 percent at the end of April to 51 percent as of 1 June, according to the CDC.
Also, the CDC, state, and local governments have eased or eliminated mask mandates and bans on gatherings, bringing more people to restaurants, airports, nail salons, and other service venues.
Many survey respondents, however, reported rising backlogs of clients, difficulty in finding workers, and delays in receiving supplies, the ISM noted.
TREND FORECAST: The difficulty in finding workers extends beyond the United States. As a DutchNews.nl headline noted this week:
Cafes, Restaurants and Events Face Staff Shortages as Lockdown Eases
They note that many people found work in other sectors that have more security and pay higher wages. The small firm’s organization. MKB-Nederland, told the paper there are currently 250,000 job vacancies in the Netherlands compared to 50,000 openings a year ago.
We note this to continue to illustrate the new ABnormal reality that was created by the launching of the COVID War by politicians… so-called “lawmakers” who suck off the public tit and do not work for a living or run businesses.
TRENDPOST: Although businesses are grateful for a recovering economy, as we continue to detail, many have trouble securing supplies and finding workers, forcing price increases throughout the supply chain. This has now been confirmed by the U.S. Federal Reserve’s latest Beige Book, a collection of business anecdotes and comments published eight times a year.
Manufacturers and home builders reported a shortage of materials and skilled workers. Car dealers are short of inventory because of shipping bottlenecks and the worldwide scarcity of computer chips.
Delivery companies are unable to find enough truck drivers; retailers often are unable to fully stock their shelves.
“Contacts anticipate facing cost increases and are charging higher prices in coming months,” the Beige Book said.
The cost increases will result, in part, from the need to offer higher pay or signing bonuses to attract qualified workers, some companies said.
Thus, the higher the cost increase, the higher inflation… which, by the data, will not be temporary.