Firms started to hire more in August after six months of layoffs, indicating some recovery in a labour market that has been hit hard by sharp falls in demand and epidemic restrictions earlier in the year.
Domestic demand drove new orders, with the Caixin survey showing new export businesses received by Chinese services firms contracting again in August, albeit at a slower pace.
However, the growth in new orders was the weakest in four months and dropped below the long-term average.
"The ongoing resumption of work and normalisation of market demand continued to promote the post-epidemic economic recovery," said Wang Zhe, Senior Economist at Caixin Insight Group.
Service firms remained optimistic about business prospects as the economy continues to recover from the COVID-19 lockdowns, although a sub-index for confidence in the year dipped from July's multi-year high.
China returned to growth in the second quarter after a deep slump at the start of the year, but unexpected weakness in domestic consumption underscored the need for more policy support to bolster the recovery.
Many analysts expect the country to be the only major economy to mark positive annual growth in 2020.
(Reporting by Gabriel Crossley; Editing by Sam Holmes)
(Only the headline and picture of this report may have been reworked by the Business Standard staff; the rest of the content is auto-generated from a syndicated feed.)
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