6 August 2010 | Lindsay Clark
There was evidence of a two-speed economy in the US this week as growth fell in the manufacturing sector but continued to increase in the non-manufacturing sectors, according to purchasing managers indices (PMIs) from the Institute for Supply Management Report On Business.
Activity in the manufacturing sector expanded in July for the 12th consecutive month, although at a slower rate than in June. The PMI was down from 56.2 to 55.5, where a 50 score represents no change.
Meanwhile, economic activity continued to increase in the non-manufacturing sectors during July as the PMI reached 54.3, a performance 0.5 points stronger than the 53.8 registered in June.
Purchasing managers from the non-manufacturing sectors suggested there were grounds for optimism in the US economy. “Our business conditions continue to dramatically outpace last year’s,” said one from the information management sector.
“Although unemployment remains high, consumer attitude has improved and it translates into higher activity levels for us,” another, from the arts, entertainment and recreation sector, said.
However, there was evidence that the credit restrictions, which were a cause of the economic downturn, were still in place. “Capital funding remains tight,” said a purchasing manager from the accommodation and food services sector.