The dominant services segment of the US economy was still suffering amid the pandemic in May but appeared poised for a recovery, according to an industry survey released Wednesday.
Yet it is unclear how recent nationwide protests will impact services industries, according to an official with the Institute of Supply Management (ISM).
ISM’s non-manufacturing index showed the industry was contracting for the second month but more slowly than in April, rising to 45.4 percent from 41.8 percent, with a 15-point jump in the production index to 41.0 percent. Anything below 50 percent indicates activity is slowing.
The two months of slowing due to the efforts to contain COVID-19 ended nearly 10 years of uninterrupted growth for the services industries.
Prior to events of the past week “it looked like we were bottoming out and hopefully were recovering a little bit,” ISM survey chair Anthony Nieves told reporters.
But now, “It will remain to be seen, with what’s going on with the combination of the pandemic and civil unrest and social injustice and everything else that’s happening right now.”
The United States has been gripped by nationwide protests, some of which have devolved into violence and looting, over the death of George Floyd, the latest in a string of black people to die at the hands of police.
Curfews have been imposed in dozens of cities to quell the unrest at a time when states were just allowing more and more businesses to reopen, while President Donald Trump has threatened to deploy the military.
Tens of millions of people in the United States have lost their jobs since the pandemic hit and businesses began shutting down in mid-March, and the ISM employment index for May was a paltry 31.8 percent, just above the month prior.