Tempe, AZ, United States (4E) – Activity in the U.S. nonmanufacturing sector expanded in August, according to the Institute for Supply Management (ISM) report released Thursday. Employment data also showed signs of strengthening last month.
The ISM non-manufacturing index climbed to 58.6 in August from 56 in July, according to the Tempe, Arizona-based group. The latest result, higher than the median forecast of a 55 reading, was the strongest performance since January 2005, according to data by Bloomberg News.
The new orders index improved to 60.5 from a 57.7 reading in July, and the business activity/production index continued its rise to 62.2, after climbing to 60.4 in the previous month. Both subindexes are at their highest levels since February 2011.
The employment index climbed to 57.0 in August from the previous month’s 53.2 level. The ISM inventory index jumped to 56.0 from 53.5.
Data from the ISM nonmanufacturing report is based on views from companies in the services sector, which make up the biggest part of the U.S. economy, as well as those in construction and public administration.
In a separate report released Thursday, it showed businesses expanded payrolls in August and unemployment benefits claims fell more than estimated last week. The U.S. Federal Reserve is closely monitoring economic data as they decide whether or not to start scaling down its monthly bond purchases at its meeting set on Sept. 17-18.