The Institute for Supply Management said Thursday that its services index rose to 59.6 last month from 58.7 in July. The August figure is the highest recorded since the measure was introduced in January 2008. Fifteen industries reported growth last month. Only mining and arts, entertainment and recreation contracted in August.
Hiring grew at services firms for a sixth straight month. Their export orders grew for a fifth straight month but at a slower pace than in July.
Jennifer Lee, senior economist at BMO Capital Markets, said the report suggests that economic growth remains healthy in the current July-September quarter after registering a robust 4.2 per cent annual pace from April through June.
"The encouraging U.S. economic news continues to roll in, pointing to continued job creation and, at some point, higher wages and then, stronger consumer spending," Lee wrote in a research note.
The ISM is a trade group of purchasing managers. Its services survey covers businesses that employ 90 per cent of the American workforce, including retail, construction, health care and financial services firms.
On Friday, the Labor Department will report on hiring and unemployment in August. Economists forecast that the economy generated 220,000 jobs. That would be the seventh straight month that job gains exceeded have 200,000, the longest such streak since 1997.