U.S. service sector growth remained positive in February while easing to a four-year low, and the private ADP payroll report revealed less hiring than expected. The addition of 139,000 jobs came after a downwardly revised 127,000 jobs in January, with both months affected by severe winter weather. Weather was also cited for the decline in the Institute for Supply Management's service sector index to 51.6.
Businesses have added 130,000 jobs this month, according to payroll processor ADP. The government shutdown and a standoff over the debt ceiling weakened the job market. ADP has revised its estimate for September job creation from 166,000 to 145,000.
An early reading on employment last month suggests a marked cooling. The ADP National Employment Report says 158,000 jobs were added, fewer than the 200,000 projected by economists. Meanwhile, the Institute for Supply Management says its service-sector index fell from 56 in February to 54.4 in March. The data point to a softer first quarter than many expected. "If we do see a pullback, it's probably not going to be all that surprising, given the headwinds we have in front of us," said Sam Bullard, a senior economist at Wells Fargo.