U.S. services activity expanded for a 28th consecutive month in October, though growth slowed from September, according to the Institute for Supply Management’s survey released Wednesday.
The ISM Services PMI registered 54.5, down 0.4 percentage point from 54.9 in September. Readings above 50 generally indicate expansion. The October result was slightly above the survey’s 12-month average of 54.3.
Business activity eased to 53.8 from 56.5, and new orders slowed to 55.9 from 59.8. Employment strengthened for a second month, rising to 51.4 from 50.1.
The report also showed growing pressure in order fulfillment. The backlog-of-orders index increased to 58.0, its highest reading since July 2022. Supplier deliveries slowed further, with that index rising to 56.7 from 53.2. In the ISM survey, a supplier-deliveries reading above 50 indicates slower performance.
Prices remained elevated. The prices index eased one point to 73.0 but stayed above 70 for the seventh time in eight months. ISM said respondents continued to cite tariffs and fuel costs as major supply-chain concerns, while some businesses had not yet passed higher costs to customers.
Fifteen of the 18 services industries tracked by the survey reported growth in October. Construction and health care and social assistance reported contraction. New export orders returned to expansion, climbing to 55.2 from 46.9.
ISM said all 10 survey indexes were in expansion territory for the first time since February. The survey reflects responses from purchasing and supply executives about U.S. operations during October and does not measure official gross domestic product.
Sources: - Institute for Supply Management, October 2026 Services PMI Report, Nov. 4, 2026