The pace of growth accelerated with the headline Purchasing Manager's Index rising from 52.7 to 53.3.
The index uses 50 as a break-even point. Above 50 indicates growth.
The new orders index for non-manufacturing businesses rose from 51.7 to 52.8, also showing faster growth.
The employment index, however, showed slower growth, coming in at 51.6, down from July's 52.5.
The prices index rose sharply from 55.6 to 64.2
In the month, 10 of 18 service industries tracked in the report showed growth and the production index showed slower output.
The August survey showed, "There is a degree of uncertainty concerning business conditions for the balance of the year," said Anthony Nieves, chair of the Institute for Supply Management Non-Manufacturing Business Survey Committee.
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