U.S. service-oriented companies, the nation's predominant job generator, grew slightly faster in September as demand from customers improved, a trade group's survey showed Tuesday.
It was the ninth straight month of expansion. The sector's growth has been sluggish since early summer, however, as consumer spending growth remains weak. Companies that supply services, which include hospitals, restaurants, airlines and banks, are highly dependent on consumer spending.
The Institute for Supply Management said its service-sector index rose to 53.2 last month from 51.5 in August. Economists had expected a reading of 52.
Readings above 50 signal growth, while levels below 50 indicate that activity is shrinking. The higher the number is above 50, the faster business has picked up. The service sector accounts for two-thirds or more of U.S. economic activity.
A gauge of future business, the new orders index, grew more quickly in September than in August, suggesting that demand for services had increased. A measure of how willing employers are to fill vacant positions showed slim growth in September after a pullback in August.
The overall index shows service companies have been expanding every month this year, but not as fast as the much smaller manufacturing sector.
That has put a damper on overall hiring. The service sector accounts for about 80 percent of U.S. employment.
In September, 11 of the industries ISM tracks reported growth, while three shrank and four had the same pace of activity.