Dec 5, 12:18 PM EST

US services firms grow at fastest pace since October 2015


AP Photo
AP Photo/Julio Cortez

Latest Business News
Alaska Airlines settles lawsuit against Virgin America deal

Trian, hungry for more, takes a bigger bite of Wendy's

Trying to discern Trump policy: He's been on both sides

Business Highlights

Prologis and Western Digital climb; Pfizer skids

Multimedia
A district summary of the Beige Book
Measuring economic stress by county nationwide
Mall malaise: shoppers browse, but don't buy
Unemployment by the numbers
Family struggles with father's unemployment
Saying an affordable goodbye
Hard times hit small car dealer
Latest Economic News
ECB seen expanding stimulus amid Trump, Italy uncertainties

German industrial production up only slightly in October

Australian economy contracts 0.5 percent in September

South Korea's Park would leave economy mired in challenges

Brazil's government proposes setting retirement age at 65

Bank of England chief: Prosperity must be better distributed

Will Italy's political drama spawn a new eurozone crisis?

US services firms grow at fastest pace since October 2015

Lufthansa, GE invest in aircraft engine plant in Poland

Get used to it: Economists see "new normal" of slow growth

Interactives
Greece's Debt Threatens to Spread
State budget
gaps map
Auto industry problems trickle down, punish Tennessee county
Women give old Derby hats a makeover in tough economy
S.C. town deals with highest unemployment in South
How mortgages were bundled and sold as securities
Tracking the $700 billion financial bailout
Tracking the year's job losses
State-by-state foreclosures since 2007
Credit crisis explained
Presidents and their economic legacies
Lexicon of the financial crisis
Americans' addiction to debt

WASHINGTON (AP) -- U.S. services companies expanded last month at their fastest pace in more than a year, an encouraging sign for the economy.

The Institute for Supply Management, a trade organization of purchasing managers, said Monday that its services index reached 57.2 in November, up from 54.8 in October and the highest level since it hit 58.3 in October 2015. Anything above 50 signals growth.

The services industry has now grown for 82 straight months. Fourteen services industries reported growth last month; only two contracted. The ISM says services companies reported that production, hiring and new export orders all grew faster than they did in October.

The continued gain in the ISM's index points to possible economic gains ahead because services companies represent a significant chunk of the U.S. economy, accounting for over 70 percent of nonfarm U.S. jobs.

Ian Shepherdson, chief economist at Pantheon Macroeconomics, said the survey's measure of employment suggests that the economy could start generating 250,000 jobs a month in the first quarter of 2017.

On Friday, the government reported that employers added 178,000 jobs in November - close to the monthly average of 180,000 added jobs so far this year.

The U.S. economy grew at a 3.2 percent annual pace from July through September, the fastest rate in two years, the government has estimated. Growth is expected to slow to an annual rate of around 2 percent in the current October-December quarter.

© 2016 The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed. Learn more about our Privacy Policy and Terms of Use.