U.S. services firms expanded at a slightly slower rate in October, after achieving a record pace in September in a sign of the economy's strength and endurance.
The Institute for Supply Management, which is composed of purchasing managers, reported Monday that its services index dipped to 60.3 in October, down from 61.6 in September. Readings above 50 point to further growth. Services companies have been expanding for 105 months, or nearly nine years.
"I was surprised it came in as strong as it did," said Anthony Nieves, chair of the ISM's services survey committee.
Seventeen services industries said that they grew last month, with just educational services saying they contracted.
The U.S. economy has been energized this year after the deficit-funded tax cuts signed into law by President Donald Trump at the end of 2017. Economic growth has accelerated with an annualized gain of 3.5 percent in the third-quarter and 4.2 percent in the second-quarter. Employers added a solid 250,000 jobs in October as the unemployment rate held at a half-century low of 3.7 percent.
The business activity and employment components of the index fell in September, although they still registered growth and suggest the expansion — already the second longest in U.S. history — will continue.
Multiple companies surveyed for the index said they're experiencing strong demand, but several firms also warned that tariffs could weigh on their businesses in the coming months.
Private services companies account for more than 70 percent of U.S. nonfarm jobs.
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