Purchasing Managers’ Index – Services

December 5, 2012

Services PMI drops to 46.4 in November – sharpening
downward trend in service economy
 The purchasing managers’ index for services (Services PMI) dropped 3.8 points
from 50.2 in October to 46.4 in November, thus reaching a new low for the year.
That said, the downward trend in the service economy is not as pronounced as what
we saw in 2008 and 2009 when the index fell to record lows.
 New orders and companies’ business activity made the most significant negative
contributions to the PMI. The employment index dropped to its lowest level since
August. Shorter delivery times and shrinking order backlogs indicate that the
demand scenario for Sweden’s service companies has continued to weaken in the
past month.
 Service companies’ production plans for the next six months have been scaled back
and the corresponding index fell to 49.9, marking the first time this year that it has
dropped below the 50 mark.
 The index for suppliers’ intermediate goods prices dropped from 52.9 in October to
50.0 in November. A weaker economy and a relatively strong krona are contributing
to lower price pressure in the service sector.

PMI – Services
(Purchasing Managers’
Index - Services)

Seasonally adjusted

2012 Nov.
Oct.
Sep.
Aug.
Jul.
Jun.
May
Apr.
Mar.
Feb.
Jan.
Dec.
Nov.
Next publication of Purchasing Managers’ Index – Services: Monday January 7, 2013
Jörgen Kennemar Swedbank, Economic Research Department, +46 (0)8-5859 7730
Administration, +46 (0)8-5859 7740, ek.sekr@swedbank.se
Sebastian Bergfelt, Silf, +46 (0)73-944 6450, professionals@silf.se
1 (4)

46.4
50.2
47.2
50.7
54.7
47.3
47.6
48.5
52.5
54.0
54.3
51.0
48.8

Silf/Swedbank’s Purchasing Managers’ Index Service Sector. seasonally adjusted
Components of PMI

2007 jan
feb
mar
apr
maj
jun
jul
aug
sep
okt
nov
dec
2008 jan
feb
mar
apr
maj
jun
jul
aug
sep
okt
nov
dec
2009 jan
feb
mar
apr
maj
juni
juli
aug
sep
okt
nov
dec
2010 jan
feb
mar
apr
maj
juni
juli
aug
sep
okt
nov
dec
2011 jan
feb
mar
apr
maj
juni
juli
aug
sep
okt
nov
dec
2012 jan
feb
mar
apr
maj
jun
jul
aug
sep
okt
nov

Other indicies

Forecast

Total index

Business
activity

Delivery
times

New
orders

Employment

Back -log
of orders

Prices

Planned
business

65.6

70.3

60.9

66.7

62.5

62.1

57.7

73.8

62.2

69.8

60.0

62.0

55.2

61.6

59.9

69.6

58.8

59.9

54.4

61.1

58.0

56.2

55.7

67.9

66.1

73.4

59.5

69.7

57.2

64.5

57.7

66.3

60.9

62.2

59.3

62.3

58.4

66.6

60.1

66.3

62.9

62.7

57.4

65.5

64.1

63.2

55.5

64.0

59.4

62.7

61.1

59.8

53.0

58.9

58.9

64.9

57.0

57.5

58.8

54.8

58.4

53.0

58.5

61.1

59.0

60.3

57.8

56.3

63.3

57.7

52.9

63.0

57.5

56.6

57.3

57.0

60.1

54.2

57.2

70.0

61.6

68.2

55.8

62.1

58.5

59.3

61.6

55.8

62.1

66.9

57.1

61.2

62.8

64.8

62.1

60.3

57.2

59.4

52.6

55.7

61.6

55.0

63.1

67.4

55.8

56.3

54.2

57.9

53.3

58.7

61.0

63.8

54.0

53.3

52.0

53.3

58.1

52.0

59.1

70.6

52.6

53.6

48.7

49.7

60.5

53.0

55.9

61.5

60.7

68.6

50.3

57.8

66.5

56.2

56.4

63.6

52.9

56.2

49.8

48.4

59.5

46.5

64.0

64.1

52.4

56.4

45.3

48.1

62.0

43.7

66.7

59.6

50.5

52.5

49.3

45.3

58.2

49.1

57.4

60.9

52.9

57.5

48.2

48.2

60.2

39.3

58.2

57.3

42.8

44.8

46.3

35.8

49.4

45.3

57.9

49.1

44.7

45.0

50.5

38.0

50.4

36.4

53.7

43.9

38.1

37.7

39.9

36.7

39.4

37.1

45.2

40.4

34.7

32.7

42.3

34.5

30.0

27.1

48.5

33.8

37.6

36.4

38.7

35.3

42.2

34.7

47.2

40.4

40.1

43.3

41.1

41.8

32.3

38.6

48.0

35.9

40.1

41.4

38.5

40.1

40.0

38.9

42.4

46.1

40.8

44.3

42.3

44.0

29.1

38.7

40.8

43.8

42.2

43.7

40.2

46.9

34.2

44.9

35.5

51.7

41.8

43.9

38.1

46.0

35.6

41.5

40.6

54.9

45.6

50.8

40.7

50.3

36.1

47.4

45.7

55.9

49.5

53.9

46.3

56.5

34.9

54.8

49.4

59.7

55.5

62.7

47.8

63.1

41.0

63.7

44.9

62.2

52.2

57.8

48.7

57.8

38.9

57.6

44.8

68.8

47.5

52.5

46.8

49.6

38.3

48.6

52.4

61.4

54.6

58.9

50.7

58.2

46.9

55.0

48.5

61.7

60.3

63.1

53.9

66.9

51.9

60.8

46.2

74.8

60.9

64.4

58.0

63.2

55.5

59.8

55.7

71.0

62.4

66.6

60.4

64.6

55.2

61.0

60.1

73.7

59.4

60.4

59.3

60.9

55.8

59.3

62.6

68.8

60.1

61.6

62.2

61.7

53.4

62.0

62.2

69.3

62.2

65.4

61.0

64.7

54.9

61.9

63.5

71.3

63.9

65.8

61.8

67.5

57.4

63.8

62.2

70.6

61.8

60.7

65.0

64.9

54.7

60.7

63.7

74.4

64.2

65.8

62.3

67.9

57.6

62.4

60.2

77.4

65.0

66.2

59.6

68.6

62.6

64.5

65.9

79.1

65.8

69.7

64.6

65.6

62.7

60.8

63.6

77.0

65.0

70.1

61.2

65.0

62.4

63.5

67.0

77.8

61.4

61.7

62.5

60.6

61.5

58.4

68.8

69.1

60.4

63.8

60.1

58.4

59.8

55.2

64.4

68.8

61.0

63.2

59.7

61.5

58.9

58.1

65.0

67.2

56.8

56.2

58.0

55.8

57.9

50.9

60.1

66.9

53.7

58.7

54.7

48.4

55.8

48.7

57.7

62.4

53.3

53.9

55.5

51.1

54.2

52.1

54.5

62.1

53.4

53.1

55.3

53.0

52.5

49.1

55.0

59.4

51.6

52.9

51.9

48.6

54.7

47.8

54.2

57.5

48.8

48.7

51.3

45.1

53.3

46.1

52.5

53.6

49.3

50.7

49.6

47.2

51.0

45.7

53.7

54.9

51.0

50.6

50.5

50.6

52.7

47.6

54.3

57.7

54.3

54.2

50.7

56.4

54.3

55.5

55.0

58.9

54.0

57.2

50.0

54.1

53.8

48.1

53.7

60.6

52.6

54.2

52.5

52.4

50.9

51.4

53.7

61.1

48.6

47.7

51.4

47.3

49.1

48.0

51.9

56.7

47.6

48.6

49.7

45.4

48.2

44.5

50.9

56.2

47.2

49.1

48.1

46.7

44.8

45.1

50.7

53.7

54.6

57.4

49.0

57.2

51.9

55.8

49.5

55.8

50.6

54.6

49.8

52.0

44.0

50.7

51.1

55.9

47.1

46.4

47.2

46.5

49.1

49.2

50.6

53.5

50.2

50.6

46.4

51.4

51.4

45.8

52.9

54.4

46.4

45.0

45.4

46.9

48.2

43.9

50.0

49.9

2 (4)

Silf/Swedbank’s Purchasing Managers’ Index Service Sector, orginal
Components of PMI

2007 jan
feb
mar
apr
maj
jun
jul
aug
sep
okt
nov
dec
2008 jan
feb
mar
apr
maj
jun
jul
aug
sep
okt
nov
dec
2009 jan
feb
mar
apr
maj
juni
juli
aug
sep
okt
nov
dec
2010 jan
feb
mar
apr
maj
juni
juli
aug
sep
okt
nov
dec
2011 jan
feb
mar
apr
maj
juni
juli
aug
sep
okt
nov
dec
2012 jan
feb
mar
apr
maj
jun
jul
aug
sep
okt
nov

Other indicies

Forecast

Total index

Business
activity

Delivery
times

New
orders

Employment

Back -log
of orders

Prices

60.9
61.7
60.6
68.7
63.8
68.0
56.1
58.8
60.4
56.7
59.1
58.4
52.5
55.3
55.8
55.2
63.6
58.0
49.1
52.3
54.3
42.0
42.2
34.4
30.0
37.1
41.9
42.7
43.6
47.3
38.5
47.5
50.9
54.7
49.7
43.7
49.9
59.8
62.7
65.0
62.3
65.2
58.9
65.8
63.2
63.4
62.5
62.1
60.3
60.9
62.2
63.6
59.6
58.8
50.0
55.2
53.0
48.0
46.8
47.2
49.6
53.5
54.4
51.2
50.5
52.3
51.2
52.3
48.6
49.4
43.8

63.3
68.9
63.4
76.2
66.3
69.0
56.3
60.0
63.1
55.6
65.8
62.5
52.4
55.4
56.8
56.4
72.7
62.5
50.0
55.0
60.3
43.8
42.6
33.3
25.7
35.5
46.8
44.2
48.4
50.0
37.5
53.3
56.7
61.7
55.4
48.1
51.9
62.2
67.9
69.4
64.5
67.9
59.0
68.3
63.5
64.8
63.8
65.3
63.1
60.8
67.3
66.0
60.3
65.0
47.5
55.6
55.7
47.7
48.3
46.2
47.2
56.3
57.7
50.5
52.7
55.4
51.0
57.1
49.2
49.6
42.6

58.3
60.0
52.4
59.5
60.5
60.7
64.1
57.8
58.1
57.8
55.3
54.7
50.0
54.2
50.0
48.7
51.5
53.1
48.3
48.3
48.5
46.8
50.0
37.5
39.7
38.7
39.1
38.5
43.5
43.5
41.1
39.7
46.6
48.3
48.2
44.4
48.1
53.9
56.0
60.4
60.5
65.5
64.0
60.8
65.3
62.8
59.1
62.2
58.6
62.5
58.1
59.7
59.2
58.0
58.5
54.3
52.2
51.8
49.1
48.1
48.1
50.0
50.5
51.4
50.9
51.4
52.0
48.8
47.5
46.9
44.9

62.2
62.2
64.6
73.8
65.1
70.2
53.1
57.8
58.1
55.6
57.9
57.8
51.2
58.1
56.8
53.8
60.6
53.1
41.4
48.3
50.0
34.4
33.8
33.3
30.0
35.5
45.3
44.2
46.8
51.6
39.3
53.3
58.3
61.7
53.6
46.2
53.7
67.1
66.7
68.7
63.7
66.4
58.0
70.5
66.7
66.5
64.4
62.2
60.5
60.8
61.9
65.6
58.6
53.1
44.4
56.0
50.4
43.7
43.0
47.2
51.9
54.3
55.9
51.4
48.2
51.4
50.5
55.0
48.3
50.0
42.7

58.2
53.3
58.5
59.5
61.6
70.2
53.1
60.2
63.4
59.1
56.6
57.8
57.3
51.4
58.6
62.8
69.7
65.6
62.1
60.0
60.3
48.4
48.5
34.4
25.7
40.3
32.8
42.3
32.3
40.3
35.7
37.9
35.0
40.0
37.0
33.3
42.6
50.0
56.0
57.5
59.0
59.5
55.0
59.2
54.8
56.6
60.7
57.7
58.1
59.6
60.3
61.2
61.1
61.9
54.3
54.3
54.8
52.3
49.1
47.7
50.0
51.9
51.4
51.4
51.4
50.9
52.0
45.8
49.2
50.4
46.3

57.1
64.0
59.8
67.9
69.8
66.7
53.1
55.6
58.1
52.2
55.3
62.5
50.0
61.1
55.6
56.4
59.4
50.0
37.9
51.7
39.7
43.3
32.4
34.8
22.1
37.1
42.2
42.3
41.9
48.4
35.7
50.0
55.2
61.7
53.6
46.3
50.0
63.2
63.4
64.4
62.5
65.5
56.1
66.4
61.1
60.4
60.5
58.5
58.5
60.8
58.8
61.5
54.1
52.2
46.3
51.7
48.2
44.1
41.7
45.3
50.5
50.5
55.0
51.4
47.7
48.6
50.0
53.3
49.6
43.8
39.4

59.2
61.1
56.1
59.5
62.8
57.1
59.4
57.8
53.5
55.6
57.9
57.8
64.6
62.2
59.5
57.7
59.1
65.6
67.2
56.7
58.8
56.3
50.0
40.9
50.0
48.4
48.4
44.2
43.5
37.1
41.1
45.0
50.0
43.3
41.1
48.1
50.0
47.4
56.1
61.9
65.3
63.8
64.0
61.5
64.3
58.6
62.2
59.3
68.5
70.0
64.8
66.8
62.8
59.3
55.0
54.3
54.8
50.9
50.0
50.0
56.5
54.9
54.1
53.7
53.6
52.3
50.0
50.4
51.2
51.3
46.3

3 (4)

Planned
business
activity

71.4
71.1
69.5
70.2
70.9
67.1
65.6
60.2
61.6
67.8
51.3
56.3
65.0
65.3
72.2
65.4
68.2
67.2
60.3
60.0
55.9
46.9
39.4
36.4
31.4
41.9
37.5
50.0
48.4
54.8
55.6
55.0
58.3
60.0
64.3
57.4
59.3
76.3
72.6
77.6
73.4
72.4
72.0
69.7
73.0
75.2
74.6
73.0
75.4
70.6
70.4
71.1
71.5
65.5
62.8
58.5
56.1
51.4
50.4
53.7
56.5
62.1
62.7
60.6
60.8
56.8
56.5
55.0
52.1
52.2
45.4

Silf/Swedbank’s

Purchasing Managers’ Index – Services
- objectives and methodology
History

Silf and Swedbank AB publ. made the first joint – internal – calculation of
the “Purchasing Managers’ Index” for the service sector of the four
indexes (PMI) during 2005. The model for PMI – Services is the U.S.
based Non-Manufacturing Index and the Swedish PMI, which has been
published since November 1994

Participants

About 200 purchasing managers in the service sector.

Publication

Third weekday of each month, 8:30 am.

Analysis Period

Comparison with previous month.

Composition
of PMI – Services (%)

New orders (within the company)
Business activity (within the company)
Employment (within the company)
Suppliers’ Delivery Times

35
25
20
20

Other leading indicators
(not included in PMI – Services) Backlog of Orders
Suppliers’ intermediate goods prices
Planned business activity next six months
Objective

Quick economic indicator
Simple statistics
Statistics with relatively short publication intervals
Constant contact with a well-informed professional group

Calculation

According to “diffusion index”. Positive changes are noted in percent for
the four sub indexes. The percentage of unchanged replies, multiplied by
0.5, is added to this figure. Then the different sub indexes are weighted as
described above to reach the total index. The Purchasing Managers’
Index – Services does not indicate activity levels but rather monthly
changes in activity in the service sector.

“Break-even”

The dividing line between growth and decline – in line with US praxis –
has been drawn at a total index of 50. However, this boundary or “neutral
growth zone” should not be applied excessively. Rather, “Break-even” at
50 indicates a target value.

We believe we have used reliable sources and procedures to generate and analyze the Purchasing Managers’ Index (PMI –
Services). However, Swedbank AB (publ) and SILF (earlier Organisationen för Inköp och Logistik, /I&L/ – The Organization
for Purchasing and Logistics) cannot guarantee the accuracy or completeness of the analyses and cannot be responsible for
any errors or omissions in the basic data or processing thereof. The reader should base any decisions on other background
material as well.
Swedbank AB (publ), SILF. their employees, and other coworkers accept no liability whatsoever for any direct or
consequential loss or injury of any kind arising from any errors or omissions in the analyses presented in the Purchasing
Managers’ Index – Services.

4 (4)

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