New York City Area Services Show First Signs of Revival in April

An index of New York City regional service-sector firms expanded in April after declining for 13 straight months, marking the first signs of life in a key industry battered during the Covid-19 pandemic.

The Federal Reserve Bank of New York’s service-sector survey index, which includes businesses such as hotels and restaurants, advanced to 30.2 from a negative 4.8 a month earlier, a report showed Friday. Figures above zero indicate expansion.

After manufacturing activity started to rebound earlier in the pandemic, the latest data on service firms signal a return to widespread growth across industries.

Employment moved higher among service firms in the New York metropolitan area for the first time since last March, as did future capital spending plans, as businesses expressed widespread optimism that conditions would continue to improve in the months ahead.

While activity picked up, wage gains have been tepid over the last year, with an average rise of 1.6% for existing service workers. Almost 40% of them receiving no increase.

Growth at New York state manufacturers expanded in April at the fastest pace since 2017, according to a report on Thursday. The manufacturing data also showed stronger orders and increased shipments, while a growing number of factories reported paying more for materials and charging higher prices.

©2021 Bloomberg L.P.

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