Growth in service industries slows in April
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WASHINGTON — Growth in service industries, which make up 90% of the U.S. economy, slowed in April after surging the previous month, according to a leading gauge.
The Institute for Supply Management said Thursday that its index of nonmanufacturing businesses fell to 53.5 last month, down from 56 in March. The drop was steeper than economists had been projecting and brought the index to its lowest level since November’s 52.6.
The April data came after the ISM reported Tuesday that manufacturing jumped in April to a 10-month high. But mixed economic messages are par for the course these days.
The jobs market also has been hard to figure out. Payroll processor ADP reported Tuesday that the number of workers added to U.S. payrolls fell in April to the lowest level in seven months. But a report Thursday showed initial claims for unemployment benefits tumbled more sharply than expected this week.
The ISM noted that its index showed that service businesses grew in April for the 28th straight month. But that growth was much slower than in March, when the sector expanded at its fastest pace since 2006.
Fifteen of 18 industries tracked by the index showed growth in April. Three industries — mining, utilities and professional, scientific and technical services — contracted, ISM said.
Even though the ISM growth statistic was down to 53.5 for the month, any reading above 50 indicates that the sector — which includes industries such as retail, entertainment, finance and construction — is considered an indication of expansion.
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