Economic activity in the U.S. service sector contracted in November following two previous months of expansion, according to the Institute for Supply Management's nonmanufacturing index released today.

The two previous months of expansion had followed a year of contraction for the index. And economists had forecast it would grow in November, according to news reports.

November's index reading was 48.7, down from 50.6 in October. Only readings of more than 50 indicate expansion.

The employment portion of the index also showed continued contraction -- but at a slower rate of decline. The employment portion of the index edged up to 41.6 in November from 41.1 in October.