US economic activity remained robust in November, but growth was impaired by a shortage of labor and ongoing supply chain delays.
That’s according to the flash read on IHS Markit’s PMIs for this month.
The services gauge missed estimates, printing 57, while the manufacturing index came in at 59.1, in line with consensus (figure below).
The accompanying color reiterated familiar concerns and underscored the extent to which “transitory” is most assuredly not the right adjective to describe myriad pandemic distortions.
“Both manufacturing and services recorded marked upturns in backlogs of work amid further severe supply chain delays and labor shortages,” the survey said.
Although businesses are still creating jobs at a “solid” rate, “many firms” reported unfilled vacancies. Some positions have been open for months, respondents said.
Inflation pressures were unrelenting. Halfway through 2021’s final quarter, gauges of input price inflation set new series highs. “Sharper increases in cost burdens at both manufacturers and service providers led to soaring prices,” IHS Markit said.
The manufacturing input price index printed 87.8, up from 86.9 in October and the highest in data back to 2007. Services sector input prices printed a new series high as well.
Those costs are being passed on to consumers. “The pace of selling price inflation matched October’s series record high,” the survey went on to note. The prices charged measure for the services sector reached 66.9, the highest reading in history (the series dates to 2009). Services sector businesses cited “marked supplier price hikes and vast increases in wage bills.”
There’s little (no?) utility in editorializing around this situation any further. It’s the same story month after month after month.
As IHS Markit chief business economist Chris Williamson put it Tuesday, “some resistance to higher prices was seen in the survey responses, serving to dampen demand growth to the slowest for nearly a year [but] average prices charged for goods and services continued to rise at an unprecedented rate.”
