Non-Manufacturing ISM Ignores Banker Layoffs, Surges Past Expectations On Biggest Jump In Employment Index Ever

Tyler Durden's picture

And another major economic indicator beat, this time coming from the January Non-manufacturing ISM data, which unlike yesterday's miss in the manufacturing ISM, surged past estimates of 53.2, up from a revised 53.0 in December, to a whopping 56.8 in January. The primary reason for this was the reported jump in Employment which rose from 49.8 to 57.4, which was the biggest jump pretty much ever (see chart below), and the highest employment number since 2006. And this happened in a month in which the banking sectors laid of thousands of bankers. Brilliant. We leave it up to readers to estimate the credibility of this report. In other news, inflation is back, as the report states that "Corrugated Cartons is the only commodity reported down in price." What was up? "Airfares; Beef; Chemical Products; Chicken; Crab; Coffee (2); #1 Diesel Fuel (2); #2 Diesel Fuel (3); Fuel; Gasoline; Medical Supplies (2); Paper; Petroleum Based Products; Resin Based Products; Vehicles; and Wire." In other news, factory order missed expectations of a 1.5% increase, coming in at 1.1%. But who cares: it is an election year and the propaganda machine is on in full force.

Here is the "credible" jobs number.

And the full breakdown from the Non-mfg ISM:

What the respondents are saying:

  • "Overall business conditions to improve. We continue to outperform previous business cycles." (Information)
  • "We are seeing increased contractor bidding and activity in Q1 2012." (Construction)
  • "Small business borrowing continues to be slow." (Finance & Insurance)
  • "New fiscal year, new budgets — expecting to show an increase in sales in first quarter." (Other Services)
  • "Economy continues to show signs of improvement and the company revenue is improving slightly, but is very susceptible to pricing and cost  pressures." (Professional, Scientific & Technical Services)
  • "There seems to be some stabilization in the economy as well as [in the] supply chain. This seems to be calming inventory and sales positions." (Retail Trade)
  • "Business is still stable; however, inflation in food prices is still a problem." (Wholesale Trade)

Finally, commodities up and down in price:

Commodities Up in Price

Airfares; Beef; Chemical Products; Chicken; Crab; Coffee (2); #1 Diesel Fuel (2); #2 Diesel Fuel (3); Fuel; Gasoline; Medical Supplies (2); Paper; Petroleum Based Products; Resin Based Products; Vehicles; and Wire.

Commodities Down in Price

Corrugated Cartons is the only commodity reported down in price.

Commodities in Short Supply

Crab; #2 Diesel Fuel (2); Fiber Cable; and Pharmaceuticals.

Note: The number of consecutive months the commodity is listed is indicated after each item.