Click photo to enlarge
A construction worker works on the site of the SoMa at Brickell apartment building in downtown Miami. The Institute for Supply Management said Wednesday that its service-sector index rose to 56.3 in May, the best reading since August 2013.

WASHINGTON -- U.S. service firms grew more quickly last month as production, hiring and new orders increased, adding to signs that the economy is accelerating after dipping at the start of the year.

The Institute for Supply Management said Wednesday that its service-sector index rose to 56.3 in May, the best reading since August 2013. The figure is an improvement from the 55.2 posted in April. Any figure above 50 indicates expansion.

The report points to solid growth after a brutal winter caused the economy to shrink 1 percent during the January-March quarter. The gains in new orders and the backlog of existing orders suggest a faster rate of hiring in the months ahead as businesses rush to meet the demand.

"With this level of activity and new orders in the pipeline, employment is going to have to come up," said Anthony Nieves, chairman of the ISM’s services survey committee. "There is no way that companies will be able to sustain a good level of output if they don’t have the bodies to do it."

The services survey covers businesses that employ 90 percent of the workforce, including retail, construction, health care and financial services firms. The ISM is a trade group of purchasing managers.

New orders rose for the fifth consecutive month, up 2.3 points to 60.5 and the highest reading since January 2011. The production component also climbed to 62.1, its strongest level since December 2010. Of the 18 industries surveyed in the report, only the mining sector contracted last month.