The U.S. manufacturing sector grew faster in August, recording its 13th consecutive month of expansion as the industrial sector continues to lead the recovery, a private research organization reported Wednesday, helping to calm fears that economic growth was stagnating. The Institute for Supply Management (ISM) said its manufacturing index rose to 56.3 in August from 55.5 the previous month. The improvement was better than economists had expected. A reading above 50 signifies expansion in the sector, while a reading below 50 indicates contraction. Rising exports and demand from businesses for capital equipment and supplies have helped increase production at factories for a year. Momentum had slowed earlier this summer from a reading of 60.4 in April, a 6-year high. But manufacturing employers are eager to add jobs. The ISM survey in August showed managers' desire to hire increased to 60.4, the strongest level in nearly 30 years. Wednesday's report suggests moderate growth will continue, said ISM chairman Norbert Ore. But a measure of new orders, which are a gauge of future business, fell to the lowest level since June 2009 after surging earlier this year. Economists said the decline suggests growth in the manufacturing sector will slow in coming months.
