MetroIntelligence Economic Update by P. DUFFY
February service sector sentiment index falls 3.4 points to 59.9 due to multiple challenges
In February, the Services PMI® registered 56.5 percent, 3.4 percentage points below January’s reading of 59.9 percent. Respondents continue to be impacted by supply chain disruptions, capacity constraints, inflation, logistical challenges and labor shortages. These conditions have affected the ability of panelists’ businesses to meet demand, leading to a cooling in business activity and economic growth.
Six of seven economics sectors improved in February
February data indicated an expansion in activity in six of the seven monitored sectors, with only Consumer Goods recording stagnation in output. Healthcare, Basic Materials and Industrials all registered a sharper upturn in output, with the Consumer Services and Technology segments signalling a renewed rise in activity. In contrast to January’s modest decline, the Consumer Services segment signalled the fastest rise in activity since last October.
Multifamily housing demand returns to higher-density markets
Per NAHB’s latest Home Building Geography Index (HBGI), through the second half of 2021, multifamily home building rebounded from quarterly declines that began at the outset of the pandemic. In the wake of the public health crisis, there was a pronounced return to higher density markets or geographies, particularly in apartment and other multifamily residential construction.