WASHINGTON (AP) -- The Institute for Supply Management reports on growth at U.S. services firms in November. The ISM will release its services index at 10 a.m. Eastern Wednesday.
STILL GROWING, BUT SLOWER: Economists forecast the growth at services firms slowed slightly in November. A reading of 55 is expected, according to a survey by FactSet. That would be down from 55.4 in October. Any reading above 50 indicates growth. The ISM is a trade group of purchasing managers.
STEADY GAINS: Growth in the service industry has been steady this year. The index reached an eight-year high of 58.6 in August and has averaged 55 over the past 12 months.
In October, sales and employment both increased. But growth in new orders slowed. That may have weighed on overall activity in the service industry in November.
The survey covers businesses that employ 90 percent of the workforce, including retail, construction, health care and financial services firms. Nearly 86 percent of job gains in the past three months have been in the service sector.
Many of those jobs created have been in lower-paying industries, such as retail, restaurants and hotels. That's a big reason that workers' paychecks have barely kept ahead of inflation.
CONSUMERS CAUTIOUS: Consumers' spending drives nearly 70 percent of economic activity. Recent reports have painted a mixed picture.
Spending at retail businesses rose 0.4 percent in October, after no change in September. That was a sign Americans were willing to shrug off the government shutdown and keep shopping.
But early estimates suggest disappointing sales over the four-day Thanksgiving weekend, arguably the most crucial shopping stretch for retail businesses. The National Retail Federation estimates that sales over the holiday weekend fell for the first time since the group began keeping track in 2006.
Economists at IHS Global Insight forecast that retail sales in November and December will increase this year at the weakest pace since 2009.
Americans are splurging on cars and other big-ticket items. Auto sales jumped 9 percent last month from the previous year to an annual pace of 16.4 million, automakers said Tuesday. That's the highest level in 6 years.
Strong auto sales are boosting activity at U.S. factories. The ISM's separate manufacturing survey showed that factory activity expanded at the fastest pace in 2 ½ years. A measure of hiring rose to its highest level in 18 months, while orders and production also accelerated.