Growth in Service Industries Was Steady in January
America’s service industries expanded in January at about the same pace as in December, indicating resilience in the biggest part of the economy.
The Institute for Supply Management’s non-manufacturing index was 56.5 in January after 56.6 in December that matched the highest level since October 2015, the Tempe, Arizona-based group’s data showed Feb. 3. Readings above 50 signal expansion at service industries, which account for about 90% of the economy.
Business activity and new orders eased in January from more than one-year highs, while a measure of employment accelerated, the report showed. Together with ISM’s latest factory survey, which showed a fifth straight month of expansion, the figures signal steady demand that will keep driving economic growth.
The group’s non-manufacturing survey covers an array of industries including utilities, retailing and health care, and also factors in construction and agriculture.
The January report showed the services employment gauge increased to 54.7 from 52.7 in December.
The new orders measure cooled to 58.6 in January from 60.7. The business activity index, which parallels ISM factory production gauge, eased to 60.3 from 60.9. The December readings were both the highest since October 2015.
Earlier in the week of Jan. 30, data showed the ISM manufacturing index climbed in January and was the strongest since November 2014.
As in manufacturing, inflation is firming at service providers. The index of prices paid jumped to 59, the highest since April 2014, from 56.1.
