Service sector grows at faster pace

Associated Press

WASHINGTON

Service companies that employ 90 percent of the U.S. work force expanded at a slightly faster pace in August. But the sector remains too weak to help an economy that is barely growing and struggling to create jobs.

The Institute for Supply Management said Tuesday that its index for service companies rose to 53.3 in August, up from 52.7 in July. Any reading above 50 indicates expansion.

The service sector includes everything from restaurants and hotels to health-care firms and financial-service companies. It has grown in all but one month over the past two years. The index reached a five-year high of 59.7 in February.

Still, overall growth among service businesses has declined in four of the past six months. High gas prices and scant wage gains have left consumers with less money to spend on services.