US service firms grow at fastest pace since August

Published on NewsOK Modified: June 4, 2014 at 9:14 am •  Published: June 4, 2014
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WASHINGTON (AP) — U.S. service firms grew more quickly last month as production, hiring and new orders increased, a sign that the economy is accelerating after dipping at the start of the year.

The Institute for Supply Management says its service-sector index rose to 56.3 in May from 55.2 in April. Any reading above 50 indicates expansion. The report points to solid growth after a brutal winter caused the economy to shrink 1 percent during the January-March quarter.

The government issues its May jobs report on Friday. Employers added 288,000 jobs in April, and the unemployment rate fell to 6.3 percent. Economists expect 220,000 jobs were created in May, according to a FactSet survey.

But payroll processer ADP said Wednesday that private employers pulled back on hiring in May, adding just 179,000 jobs.