Service Sector Expands in February
TEMPE, Ariz. (TheStreet) -- Growth in the nation's service sector picked up the pace last month, continuing an upbeat trend that's seen that stratum of the economy expand now for the second straight month.
The Institute for Supply Management said its non-manufacturing index, which tracks strength in the service sector, rose to a seasonally adjusted reading at 53 in February. That bettered the 50.5 mark posted in January, as well as consensus estimates from Briefing.com calling for a reading of 51. The February pace also rose to its best showing in over two years.
A showing above 50 typically denotes expansion and growth in the industry, while a result below that mark suggests contraction. The index is created using data from purchasing and supply executives around the country.
The report suggested improvement on several fronts, with new orders, production, deliveries and new export orders all showing upticks.Though continuing to show contraction, a specific reading on service-sector employment also showed gains, registering 48.6% last month after hitting 44.6% in January. The employment news also echoes earlier reports showing declining private sector job losses and layoff announcements throughout the economy. The government is expected to release its February jobs report on Friday, with many anticipating nonfarm payrolls to drop again and the unemployment rate to edge higher. An earlier assessment by ISM showed continued growth in the manufacturing sector, albeit at a slower pace. Stocks continued trading higher after the report, with the Dow Jones Industrial Average adding 45 points, or 0.4%, to 10,451 and the S&P 500 gaining 5 points, or 0.4%, to 1123. -- Written by Sung Moss in New York
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