Service sector shows accelerated growth
NEW YORK — Growth in the U.S. service sector accelerated in February to its fastest pace in more than two years, but jobs remained hard to find.
The Institute for Supply Management said today its index measuring service industries rose to 53 in February from 50.5 in January.
Economists polled by Thomson Reuters had expected a smaller increase to 51.
Any level above 50 signals growth. The 53 reading is the highest since January 2008, when ISM revised how it measured the service sector.
The service-sector gauge is closely watched because service jobs comprise more than 80 percent of non-farm U.S. employment in areas such as health care, retailing and financial services.
Business activity and new orders both grew faster in February, ISM said, despite severe winter weather.
Meanwhile, its measure of employment improved to 48.6, the highest level since April. That’s still the 26th consecutive month of shrinking jobs, but it is approaching the level where companies could begin to hire again.
“It looks like we’re gaining traction across the board,” said Anthony Nieves, chair of ISM’s service-sector survey.
Of the 18 industries ISM surveys, nine reported growth in February, led by information, arts and entertainment and transportation and warehousing. Eight industries shrank, led by educational services, health care, and management and support services. One group, agriculture, held steady.
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