Economic activity in the US nonmanufacturing sector increased in June at a faster pace than May. The Institute for Supply Management’s nonmanufacturing composite index rose to a reading of 56.5 from May’s reading of 52.9.

Readings above 50 indicate expansion in the sector.

The employment portion of the index also rose in June after one month of contraction. The index rose three percentage points to 52.7% from the May reading of 49.7.

Twelve industries reported increased employment in June. The mining industry reported the largest increase, followed by arts, entertainment and recreation; and real estate, rental and leasing.

Two industries reported a reduction in employment in June: Educational services and other services.

Canada PMI edges down

The Royal Bank of Canada’s Canadian manufacturing purchasing managers’ index stepped down to a reading of 51.8 in June, down slightly from 51.2 in May. Although the index posted above the 50.0 no-change value for the fourth month running, the latest reading signaled only a marginal upturn in overall business conditions and the weakest pace of improvement since March.

“While the slowdown in the growth of manufacturing during June is disappointing, Canadian manufacturers did indicate a marginal upturn in new business volumes,” said Craig Wright, senior VP and chief economist at RBC. “Currency weakness and stronger US demand should drive further exports, however growing economic uncertainty means that the roller coaster we’ve experienced recently in the Canadian export market will likely continue.”

Higher levels of business underpinned further staff recruitment across the manufacturing sector in June, which extended the current period of net job creation to four months. However, the pace of employment growth eased slightly since May amid reports of heightened uncertainty about the business outlook and a lack of pressure on operating capacity.

The RBC PMI is a monthly survey conducted in association with Markit, a financial information services company, and the Supply Chain Management Association. It is based on data compiled from monthly replies to questionnaires sent to purchasing executives in more than 400 industrial companies.