September 3, 2009

U.S. service sector shows some improvement

New orders in U.S. service industries came close to breaking even in August, an industry research group said Thursday.

The Institute for Supply Management said the new orders index in the non-manufacturing sector gained 1.8 percentage points over July, but came in at 49.9 for the eleventh consecutive month of contractions. One tenth higher -- at 50 -- is considered a breakeven month.

The headline index, the Non-Manufacturing Purchasing Managers Index gained 2 percentage points to 48.4. It is also in the 11th consecutive month of declines, but the decline has slowed somewhat.

The index has made incremental gains through the year, starting at 40.6 in January. But the index lags behind the manufacturing index released Tuesday.

With the manufacturing index in the black for the first time in 18 months, President Barack Obama said the economy was heading in the right direction.

The steps we've taken to bring our economy back from the brink are working, Obama said.