The Australian services sector has recorded its first expansion in two years.
Leading the way was growth in sales and employment in the health, community and financial sectors, the Australian Industry Group (Ai Group) says.
The Ai Group's performance of services index jumped 5.8 points to 55.2 in February, the first sign of expansion since January 2012. A reading above 50 indicates expansion while below shows contraction.
Solid employment and sales growth across the services sector had helped the industry claw its way into expansion, Ai Group chief executive Innes Willox said on Wednesday.
"There was a hint of this welcome movement in January with reports of strength in new orders after a gradual climb from very low levels in mid-2013," he said.
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"There are further encouraging signs of a long-awaited lift in services industries with the rise in employment pointing to higher levels of business confidence, with new orders continuing to grow in February and with the retail sector on the brink of expansion."
However, he said the sector was still short of a full recovery with expansion confined to a couple of sectors and with businesses in other areas reporting ongoing weakness.
In a breakdown of the sub-sectors, health and community services (67.7) and finance and insurance (67) were the only two categories to record expansions.
Retail trade edged closer to expansion at 49.5.
Transport and storage services recorded the lowest sector reading at 38.4.
Overall, employment lifted (52.7), as did wages (55).
