Data released on Wednesday, showed the ISM services index reached a record high level in October. Activity has never been more fast-paced, demand shows no signs of slowing, prices show no signs of falling, good help is hard to find and the wait time for supplies is everlong, explained analysts at Wells Fargo.
Key Quotes:
“October's services ISM rose to its highest level on records that date back to 1997. A number of components rose to multi-year, if not all-time highs.”
“The biggest increase of any component was the business activity measure, which shot up 7.5 points to a record high 69.8. Service providers have never been busier at any point in the past 24 years.”
“New orders surged to 69.7, a more than six-point jump from the 63.5 level in September. Finding sales and taking new orders used to be the tricky part. In today's white-hot demand environment taking orders is a piece of cake, the challenge comes when you try to deliver those services.”
“The highest reading of any sub-component is still the prices-paid measure.”
“The primary challenge to the labor market's recovery continues to be the supply of workers. While the factors deterring workers from looking for employment have not disappeared over the past month, many have eased with fewer people reporting not looking for work due to COVID fears and childcare in October. The recent expiration of enhanced unemployment benefits amid strong wage gains should also incentivize workers to return to the labor force. Squaring all of these developments, we still expect to see that employers added 390K workers in October when the payroll report is released Friday.”
