ISM Services PMI came in well below expectations, coming in at 52.1 (street was expecting 55.7), and 3.9 points below October.

Although any reading above 50 means expansion, so the services sector (roughly 2/3rds of today’s economy) continues to expand, albeit at a slower pace, for the 5th straight month. With 14 out of the 18 major services industries reporting growth.

The 3 most forward-predicting components in the report are business activity, production, and employment. Business activity dropped from 57.2 to 53.7, but still expanding, with 14 industries reporting growth.

New orders fell from 57.4 to 53.7, with 13 industries reporting growth.

Employment dropped from 53.0 to 51.5, with only 5 industries reporting growth.

Finally, with inflation still being a problem, we look at the prices paid index, we actually increased from 58.1 to 58.2. With 14 industries reporting paying higher prices.

ADP publishes its monthly national employment report before the big nonfarm payroll report on Friday. I like this report because it focuses on just the private sector, as opposed to NFP which includes government employment.

146K private sector jobs were added in November (below street estimates of 152K), which is below the historical average of 162.5K (orange line) and October’s +184K.

+120K jobs were added by large corporations, while mid sized corps added +42K, and small corps actually lost about -17K.

Job gains from the manufacturing sector were +6K, while the services sector added +140K.

Private sector employment is now +6.5% above the pre-COVID highs.

Total (EPA: TTEF ) ADP employment is up +1.4% over the last 12 months ending in November.

The 3-month average actually ticked up to +163K, while the 12-month average increased to +154,833.

Overall, still consistent with an economy that is slowing but not yet in danger of tipping into recession. Services prices are still way too high to put this inflation fight behind us.