In this Monday, Oct. 2, 2017, photo, a construction worker on a scaffold works on a high-rise condominium project in Miami. On Wednesday, Oct. 4, 2017, the Institute for Supply Management, a trade group of purchasing managers, issues its index of non-manufacturing activity for September. (AP Photo/Alan Diaz)
October 04, 2017 - 7:34 AM
WASHINGTON - U.S. services companies in September expanded at the strongest rate in dozen years as a measure for new orders climbed sharply.
The Institute for Supply Management said Wednesday that its services index rose last month to 59.8 from 55.3 in August. The September reading was the highest since August 2005. Any reading above 50 signals growth. The services sector has expanded for 93 straight months.
The gains point to a potentially faster economic growth — which could help to spur more hiring and stronger pay raises. The U.S. economy has gone through a steady but slow recovery from the Great Recession that entered its ninth year this summer. The index suggests that Hurricanes Harvey and Irma disrupted many businesses without derailing overall growth.
New orders and business activity both rose last month, while a measure for employment improved slightly. Private service-sector workers account for more than 70 per cent of American jobs — making this a valuable sign that the government's jobs report out Friday will show that hiring was positive in September.
Fifteen services industries reported growth, including retail, real estate, health care and social assistance and lodging and food services. But two sectors contracted last month: mining and entertainment.
News from © The Associated Press, 2017