Service Sector Shrinks In October
In yet another sign of the ongoing economic contraction, a key measure of the health of the U.S. service sector took a nosedive last month.
The Institute for Supply Management, a trade group of purchasing executives, said today that its service sector index dropped from 50.2 in September to 44.4 last month, a steeper drop than was expected.
If the index drops below 50, it means the sector is in contraction.
The U.S. service sector includes hotels, shops, party planners, construction firms, garbage haulers and the like.
According to the Census Bureau, the service sector accounts for about 55 percent of all U.S. economic activity.
-- Frank Ahrens
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Frank Ahrens
|
November 5, 2008; 2:08 PM ET
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Posted by: gerryparks | November 5, 2008 8:17 PM | Report abuse
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In the last big financial meltdown (1929) the US (and world)economy was made up largely of agriculture and manufacturing. Services were limited to transport (railways and the like). There was no internet. Given that the US economy is now 55% services which are relatively easy to downsize, we can expect to see employment implode with amazing speed. Putting a robust (if only temporary) social safety net in place for these people will need to be a priority for the Obama administration.