China’s services sector gains momentum as employment recovers
August had seen China’s services sector expanding for four consecutive months, an industry survey showed on Thursday. This followed after companies started hiring more people for the first time since January.
The Caixin/Markit services Purchasing Managers’ Index placed at 54.0 in August, just below the 54.1 record in July. The drop came to be the index’s second month of decline after its decade high seen in June. However, it still placed above the 50 threshold that separates expansion from contraction.
Chinese firms began hiring more people in August after six months of layoffs. This suggests that the virus-beaten labor market is recovering.
The services sector which covers almost 60% of the economy and half of the urban jobs, initially recovered slower than large manufacturers. Despite this, the sector gained momentum as virus-driven restrictions on public gatherings were lifted.