The numbers: The huge service side of the U.S. economy — retailers, restaurants, banks, hospitals and the like — expanded in September for the fourth month in a row and employment also grew for the first time since the pandemic began, a survey business executives showed.
An index of non-manufacturing companies rose to 57.8% last month from 56.9% in August, the Institute for Supply Management said Monday.
Any number above 50% means more companies are expanding. Strong gains in both the ISM service and manufacturing indexes suggest the recovery set down more roots in September.
Read:Consumer confidence surges to highest level of coronavirus era
The surveys are limited in what they reveal, however. The ISM survey of senior executives asks if business has gotten better or worse compared to the prior month, but it doesn’t reveal how much better. As the result, the relatively high level of the index overstates how well the economy is performing.
While many companies have fully reopened and are getting back up to speed, others like restaurants and airlines continue to operate under government restrictions or have suffered a deep decline in customer traffic that won’t be quickly reversed.
What happened: New orders and production both grew a bit faster in September.
The index of new orders dropped rose to 61.5% from 56.8%. And the gauge for production edged up to 63% from 62.4%.
The best news was employment turning positive for the first time since February. The employment gauge climbed to 51.8% from 47.9%, suggesting companies are adding more workers than they are letting go.
Service-oriented businesses cut millions of jobs earlier in the pandemic and employment remains well below precrisis levels, however. Nor is the coast entirely clear.
Read:U.S. adds 661,000 jobs in September and unemployment rate falls to 7.9%