By Agence France-Presse The vast U.S. services sector grew slightly in April even as firms axed jobs, data showed May 5. The Institute for Supply Management (ISM) said its index of non-manufacturing activity rose to 50.7 in April from 47.9 in March. Any figure above 50 indicates an expansion in activity. In the same month, U.S. firms announced 146,399 job cuts in April, up 71% from March, according to an industry survey by outplacement firm Challenger, Gray and Christmas, Chicago. "The sharp increase in job cuts last month should serve as a warning that it is premature to conclude that a quick end to the war in Iraq will bring a quick turnaround in the economy and job market," said the outplacement firm's chief executive, John Challenger. "We are starting to get some indication that even after the war, businesses are reluctant to boost activity, certainly hiring," BMO Financial Group economist Sal Guatieri said. "Maybe the underlying pace of demand in the U.S. economy is a little weaker than we thought, and we cannot ascribe all of it to the war." A breakdown of the ISM services sector survey shows that new orders returned to growth, with the index rising to 50.6 in April from 47.7 in March; employment fell, but at a slower pace, with the index rising to 48.2 from 47.9; and prices rose, but at a slower pace, with the index falling to 56.7 from 62. "It is too soon to see any major rebound from the effects of the war," Naroff Economic Advisors President Joel Naroff observed. "That there was a decent rebound in the ISM non-manufacturing report, especially in light of the weak manufacturing results [last week], holds out hope that a fair amount of the problems created by the war were only temporary." The ISM's manufacturing activity index fell to 45.4% in April from 46.2% in March, the Tempe, Ariz.-based organization said last week.