US Service Sector grows, hiring improves in January

January ISM Service sector

The US service sector growth picked up in January after two months of slower growth.

The Institute for Supply Management (ISM) reported that its service index grew to 54% in January, up from its 53% December reading. This narrowly beat expectations of 53.7 from forecasters surveyed by Dow Jones Newswires. This marks the 49th consecutive month of growth. A reading above 50 indicates the sector is expanding.

Following a December contraction, the New Orders Index expanded to 50.9%.

Hiring continued to be strong as the Employement Index rose to 56.4% from the December reading of 55.6% and indicates growth in employment for the 25th consecutive month and at a faster rate.

Overall the ISM index still points to a solid growth from the Service Sector. The majority of respondents continue to see improvements in business conditions. Weather conditions have negatively impacted business this winter but overall the majority feel positive about future economic growth.

Click to see why Service stocks should be a significant part of your portfolio

The Institute of Supply Management reported that 11 of the 18 non-manufacturing industries reported growth in Janurary— listed in order — are: Management of Companies & Support Services; Agriculture, Forestry, Fishing & Hunting; Other Services; Public Administration; Utilities; Professional, Scientific & Technical Services; Information; Wholesale Trade; Real Estate, Rental & Leasing; Retail Trade; and Finance & Insurance.

Respondents of the survey said:

  • "Slight increase in business being seen currently." (Management of Companies & Support Services)
  • "Business conditions continue to improve." (Information)
  • "Activity picking up on new-year projects." (Finance & Insurance)
  • "All phases of the business seem to be getting stronger and have good first half-year outlooks and booked business." (Professional, Scientific & Technical Services)
  • "Sales has shown signs of improvement, but lack a sustained pattern to build confidence." (Retail Trade)
  • "Casual dining remains challenging, tends to slow after the holidays." (Accommodation & Food Services)
  • Intense weather in several areas of the country is perceived to have contributed to a slow start in what otherwise is historically a strong month." (Wholesale Trade)

Click here for the full release.


Share This Story, Choose Your Platform!

About the Author: Chris Wang

Chris Wang


Please remember that past performance may not be indicative of future results.  Different types of investments involve varying degrees of risk, and there can be no assurance that the future performance of any specific investment, investment strategy, or product (including the investments and/or investment strategies recommended or undertaken by Runnymede Capital Management, Inc.-"Runnymede"), or any non-investment related content, made reference to directly or indirectly in this blog will be profitable, equal any corresponding indicated historical performance level(s), be suitable for your portfolio or individual situation, or prove successful.  Due to various factors, including changing market conditions and/or applicable laws, the content may no longer be reflective of current opinions or positions.  Moreover, you should not assume that any discussion or information contained in this blog serves as the receipt of, or as a substitute for, personalized investment advice from Runnymede.  Please remember that if you are a Runnymede client, it remains your responsibility to advise Runnymede, in writing, if there are any changes in your personal/financial situation or investment objectives for the purpose of reviewing/evaluating/revising our previous recommendations and/or services, or if you would like to impose, add, or to modify any reasonable restrictions to our investment advisory services. To the extent that a reader has any questions regarding the applicability of any specific issue discussed above to his/her individual situation, he/she is encouraged to consult with the professional advisor of his/her choosing. Runnymede is neither a law firm nor a certified public accounting firm and no portion of the blog content should be construed as legal or accounting advice. A copy of the Runnymede's current written disclosure Brochure discussing our advisory services and fees is available for review upon request. Please Note: Runnymede does not make any representations or warranties as to the accuracy, timeliness, suitability, completeness, or relevance of any information prepared by any unaffiliated third party, whether linked to Runnymede's web site or blog or incorporated herein, and takes no responsibility for any such content. All such information is provided solely for convenience purposes only and all users thereof should be guided accordingly.

Search Website

Annuity Review Database

Follow Our Podcast

Google Podcasts
Apple Podcasts

Recent Posts