Services index jumps in September

• ADP survey says 162,000 jobs were added last month
• ISM report says services sector expanded for 33rd month
• Labor Department's employment report is out Friday

WASHINGTON (AP) — Two private surveys delivered a mixed picture of the economy Wednesday.

The Institute for Supply Management said U.S. services companies, which employ nearly 90% of the work force, grew in September at the fastest pace since March.

The ISM said its index of non-manufacturing activity rose to 55.1, from 53.7 in August. A reading above 50 indicates the sector is expanding.

The service sector has grown for 33 months, based on the ISM survey. The report measures growth in a broad range of businesses from retail and construction companies to health care and financial services firms.

Earlier Wednesday, a private survey said businesses hired fewer workers in September than August.

Payroll processor ADP said Wednesday that companies added 162,000 jobs last month. That's below August's 189,000, which was revised lower.

The September increase was better than economists had expected and marks the latest in a string of modest hiring gains reported by the survey. Still, the gain isn't enough to significantly push down the unemployment rate, which has been above 8% for three and a half years.

About 100,000 new jobs are needed each month just to keep up with growth of the working-age population. Twice as many are typically needed to bring unemployment down rapidly.

The report only covers hiring in the private sector and excludes government employment. The Labor Department will offer a more complete picture of September hiring Friday at 8:30 a.m. ET.

The ADP and government surveys frequently diverge. In August, the government said private companies added 103,000 jobs.

Economists forecast that the Labor Department report will show employers added 111,000 jobs in September, slightly more than August. The unemployment rate is expected to tick up to 8.2%.

In September, services companies added 144,000 jobs, the ADP report said. Manufacturing, construction and other goods-producing industries gained 18,000.
The economy grew at a 1.3% annual rate in the April-June quarter, down from 2% in the January-March quarter and 4.1% in the final three months last year.

Most economists expect growth to stay at about 2% the rest of this year.