India’s Services Sector Maintains Strong Growth In May As Job Creation Hits Record High

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India’s services sector continued its robust expansion in May, with business activity accelerating and employment reaching an all-time high. The HSBC India Services Purchasing Managers’ Index (PMI) recorded a reading of 58.8, reflecting nearly three years of uninterrupted growth. Strong domestic demand and a surge in international orders have fueled this momentum, positioning India’s services sector as a key driver of economic resilience.

Key Highlights Of India’s Services Sector Performance
- The HSBC India Services PMI rose to 58.8 in May, slightly up from 58.7 in April, signaling continued expansion
- Job creation reached its highest level since the survey began in 2005, driven by strong demand and business confidence
- New export orders saw their fastest rise in nearly 20 years, highlighting India’s growing integration with the global services economy
- Sectors such as finance, business services, IT, and real estate contributed significantly to the growth
- Inflation remained structurally low, supporting business expansion and investment flows

Surge In Employment And Business Confidence
India’s services firms ramped up hiring at an unprecedented pace, with nearly 16 percent of surveyed companies reporting workforce expansion. This hiring spree reflects optimism about future demand, as businesses anticipate sustained growth in client acquisitions and international trade.

Global Demand And Export Growth
International demand for Indian services surged, with firms reporting strong orders from Asia, Europe, and North America. The rapid increase in export business underscores India’s rising prominence in global trade, particularly in technology-driven and customer-facing industries.

Future Outlook And Economic Implications
- Analysts expect India’s services sector to maintain its growth trajectory, supported by favorable macroeconomic conditions
- The government’s policy push, including relaxed provisions in the Special Economic Zones (SEZ) Act, is expected to further boost domestic production and exports
- Foreign direct investment remains strong, with India attracting over $600 billion in the last decade, reinforcing investor confidence

Sources: News18, MSN, Economic Times, Financial Express.