U.S. service industries continued to post strong sales in November, the latest evidence the economy is experiencing another quarter of solid growth.
The Institute for Supply Management, a trade group, said Tuesday its index of nonmanufacturing activity stood at 57.4 in November, down from October but a high number historically. Any reading above 50 indicates expanding sector activity as measured by factors such as sales, prices, and hiring.
Economists surveyed by The Wall Street Journal had expected a reading of 59.
The index fell 2.7 percentage points from a 12-year high posted in October but remained robust compared with recent years and suggested the economy as a whole is growing at above a 3% annual rate.
“Consumer confidence is there and companies are also reacting favorably to the current business conditions,” said Anthony Nieves, who heads the ISM survey. “And the global economy is getting better as well.”
The report showed a measure of growth in new orders — or sales — fell 4.1 percentage points. Employment growth slipped, as did export growth. But the declines reflected slightly slower growth rather than outright declines.
Service industries — a broad category including accountants, lawyers, hair stylists and real-estate brokers — reflect the bulk of the U.S. economy.
Despite the decline in the overall index, “it remains well above its average over the past couple of years and consistent with healthy GDP growth,” Capital Economics economist Andrew Hunter said in a note to clients.
Source: Dow Jones