Millie Brown, a cook and waitress at Buch's truck stop, serves a breakfast… (Keith Srakocic /Associated…)
WASHINGTON -- Growth in the crucial service sector slowed last month as business activity and new orders dipped, according to a key private-sector index released Monday.
The Institute for Supply Management's non-manufacturing index dipped to 54.2 in October from 55.1 the previous month, the group said. The figure was slightly below analyst expectations of about 54.5 and marked the first slowdown in growth since June.
Still, the group's widely watched purchasing managers index showed growth in the sector for the 34th straight month. The last time the figure was below 50 -- the level at which the sector is growing -- was in December 2009.
Quiz: Test your knowledge of business news
ISM said the majority of comments from businesses in its monthly survey "reflect a positive but guarded outlook on business conditions and the economy."
ISM's manufacturing index, released Thursday, showed slightly stronger growth, but that sector has not performed as well as the service sector in recent months.
The group's service-sector index is made up of 18 non-manufacturing industries, including transportation, construction, retail trade, food services and healthcare.
Thirteen of those industries showed growth in October and five -- mining, utilities, wholesale trade, public administration and arts, entertainment and recreation -- reported contraction.
ISM's employment index for the sector was up 3.8 points to 54.9, indicating growth in hiring for the third straight month. But the index's gauge of new orders, a barometer of future activity, dropped 2.9 points to 54.8.
Home prices rise in August
Jobs report arouses new optimism
Manufacturing, construction and consumer confidence show gains
Follow Jim Puzzanghera on Twitter and Google+.