The Service Sector Continues to Grow
Most of the economic news from January has been encouraging. The economy is adding jobs at a rate not seen since 1997, wages are up and GDP growth is clocking at around 4%. To top this off, we learned last week that the service sector grew for the 60th straight month.
The latest Non-Manufacturing ISM Report on Business showed continued growth in the sector, with a reading that was 0.2% higher than December’s. The Non-Manufacturing Business Activity Index rose even more, by 2.9 percentage points.
Eight non-manufacturing industries reported growth in January, including: Accommodation & Food Services; Finance & Insurance; Management of Companies & Support Services; Public Administration; Wholesale Trade; Information; Health Care & Social Assistance; and Retail Trade. The eight industries reporting contraction in January — listed in order — are: Mining; Arts, Entertainment & Recreation; Construction; Other Services; Real Estate, Rental & Leasing; Professional, Scientific & Technical Services; Educational Services; and Transportation & Warehousing.
Since our economy is now more than 60% services, this kind of strong, steady growth in the sector is welcome news. Let’s hope it continues.
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