US service sector growth slows sharply in February

The services sector, where most Americans works, grew at a sharply slower pace in February with various problems related to the pandemic hindering growth

Via AP news wire
Wednesday 03 March 2021 15:21

Growth in the services sector, where most Americans works, slowed sharply in February with hurdles related to the pandemic hindering growth

The Institute for Supply Management said Wednesday that its index of service sector activity dropped to a reading of 55.5% in February, down 3.4 percentage-points from January when activity neared a two-year high.

Even with the decline, it was the ninth straight month of growth in the services sector. Any reading above 50 signifies growth

Economists had expected some rollback from the January high but the size of the February drop was much bigger than expected.

Service sector businesses were mostly optimistic about the recovery, according to the report Wednesday, but they cited supply chain problems such as production-capacity restraints and material shortages among the problems they are facing.