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Business Activity Stayed Steady

Tenth District services activity stayed steady in July, while expectations for the next six months rose slightly (Chart 1 & Table 1). Contacts continued to report that both input and selling prices increased, but more reported increases in input compared to selling prices.

The month-over-month services composite index was -1 in July, down from 14 in June and 3 in May (Tables 1 & 2). The composite index is a weighted average of the revenue/sales, employment, and inventory indexes. Tourism revenues increased substantially, while wholesale and real estate activity declined significantly. Growth in restaurants and retail cooled in July. All month-over-month indexes decreased from previous readings, except for part-time/temporary employment and input prices. The general revenues/sales index declined substantially from 20 to -1, and the number of employees and employee hours worked indexes also entered negative territory. Inventory levels slowed somewhat but continued to increase. The year-over-year composite index was unchanged at -11, as revenues, employment, and inventories continued to decrease. Expectations for services activity edged up as firms anticipate increases in revenue and steady employment, with the composite index increasing from -4 to 4.

Services Composite Indexes

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A time series chart from July 2018 to June 2023 showing the services composite diffusion index of activity versus a month ago and versus a year ago. The month-over-month composite index was -1 in July, down from 14 in June and 3 in May. The year-over-year composite index stayed at -11 in July.
Date Vs. a Month Ago Vs. a Year Ago
Jun-22 14 27
Jul-22 4 18
Aug-22 14 16
Sep-22 18 16
Oct-22 8 17
Nov-22 12 21
Dec-22 0 14
Jan-23 -11 2
Feb-23 1 2
Mar-23 -4 -6
Apr-23 7 -2
May-23 3 -4
Jun-23 14 -11
Jul-23 -1 -11

Special Questions

This month contacts were asked special questions about profit margins. A majority of firms reported that profit margins decreased significantly (17%) or decreased slightly (45%) since the beginning of the year, while 20% of firms reported no change in profit margins, 13% reported a slight increase, and 5% reported a significant increase (Chart 2). Firms were also asked how supply chain issues have changed from a year ago. About a quarter (27%) of contacts reported they were much better, while 37% said they were slightly better, 22% reported no change, 8% reported they were slightly worse, 0% reported they were much worse, and 6% of contacts have not experienced supply chain issues over the last year (Chart 3).

Selected Services Comments

“Consumers are becoming more concerned that rates will go even higher, which makes them reluctant to make large purchases such as homes or automobile loans.”

“We are hesitant to invest in growing the business until better direction with the economy.”

“Freight charges are killing us. Freight takes one third of our profits on an item.”

Survey Data

PDFCurrent Release

Excel SpreadsheetHistorical Monthly Data

External LinkAbout the Services Survey


Chad Wilkerson

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Chase Farha

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Jannety Mosley

Senior Survey Analyst

Jannety Mosley is a Senior Survey Analyst in the Regional Affairs Department at the Oklahoma City Branch of the Federal Reserve Bank of Kansas City. In this role, she primarily s…