The November ISM service sector report was about as expected, and confirms the message we are getting from numerous areas: the economy is growing at a modest/moderate pace, and there is continued upward price pressure. The most encouraging thing in the report from my perspective was the employment index, shown above. Almost 53% of those surveyed report their companies are in a hiring mode, the most since before the last recession started.
With so many idle workers still out there, a return of business confidence can quickly result in a significant pickup in jobs and total output. U.S. companies are still accumulating a mountain of over $1 trillion in profits just waiting to be put to work when the conditions are more favorable. It certainly pays to remain optimistic even though the economy seems sluggish.
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