The U.S. services sector expanded at a slightly slower pace in April as the non-manufacturing business activity composite index was 53.1 in the month, compared to 54.4 in March, on a seasonally adjusted basis, the Institute for Supply Management reported Friday.
Economists polled by Thomson Reuters had expected a 54.0 level.
An index reading below 50 signals a slowing economy, while a level above 50 suggests expansion.
The prices paid index slid to 51.2 from 55.9.
The employment index decreased to 52.0 from 53.3.
The business activity/production index dipped to 55.0 from 56.5, the new orders index was at 54.5, down from 54.6; backlog of orders slipped to 51.5 from 54.5; new export orders fell to 53.5 from 56.5; inventories climbed to 56.0 from 51.5; inventory sentiment rose to 60.5 from 59.5; the supplier deliveries index dipped to 51.0 from 53.0; and imports grew to 58.5 from 57.5.
Members' general comments on business in the month included:
"Similar demand as 2012; demand well-controlled by suppliers. Overall demand trend to become weak." (Agriculture, Forestry, Fishing & Hunting)
"Continued corporate cost pressures creating greater demand for cost restructuring/productivity work." (Professional, Scientific & Technical Services)
"Business continues to fluctuate, making it extremely difficult to forecast. Economic uncertainty is clearly a factor that is influencing discretionary spending. Marketing efforts, therefore, are focused mostly on increasing the spend per visit, getting consumers to stay longer at the property as the frequency of repeat business trends down." (Arts, Entertainment & Recreation)
"Revenue pressures are creating challenges on the expense side of the house." (Finance & Insurance)
"Reducing costs in healthcare and higher education remains of paramount importance." (Educational Services)
"We are seeing no real change for our next fiscal year - budgets are still tough with anticipated spend at previous-year levels." (Public Administration)
"Business appears to be on the up-swing." (Transportation & Warehousing)