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US service sector picks up slightly in February
[WASHINGTON] The US economy's service sector sped up very slightly in February despite the West Coast port slowdown and harsh weather in the east, the Institute for Supply Management reported Wednesday.
The ISM purchasing managers index edged up to 56.9, from 56.7 in January.
That was more than three points better than a year ago, but slower than the 58.8 level of November. Anything above 50 indicates expansion in the sector.
While overall non-manufacturing activity was better, including pickups in prices and hiring, new orders and overall business activity grew more slowly than the previous month, ISM said.
Respondents to the survey - with the exception of those in or tied to the oil and gas industry - said the fall in fuel prices was helping their business.
But many said the sharp slowdown in cargo processing at ports along the West Coast, due to a contract fight between unions and management, had hurt their businesses.
The two sides reached a deal on February 21 and the ports were fully back to work the next day, facing a huge backlog of vessels and containers to clear.
Despite the port slowdown, ISM said that "overall, supply managers feel mostly positive about the direction of the economy."
"Sales continue to be solid which is believed to align with lower fuel costs and overall consumer sentiment being positive," said one respondent from the retail trade.