Service sector grows in January, employment speeds up: ISM

NEW YORK, Tue Feb 5, 2013 — The U.S. services sector expanded in January although the pace slowed slightly from the previous month, with robust jobs growth offsetting slowness in new orders, according to a report released on Tuesday.

The Institute for Supply Management said its services sector index eased slightly to 55.2 last month from 55.7 in December. The reading was in line with economists’ forecasts, according to a Reuters survey.

The employment sub-index was at its highest since February 2006, rising to 57.5 in January from 55.3 in December.

A reading above 50 indicates expansion in the sector, while one below 50 indicates contraction. The index was last below 50 in December 2009 as the U.S. economy was beginning to recover from the financial crisis and recession.