WASHINGTON — Companies in the U.S. service sector expanded at their fastest pace in nearly 8 years last month as sales and orders grew and employers ramped up hiring.

The Institute for Supply Management says its service-sector index rose to 58.6 in August from 56 in July. It’s the highest point since December 2005. Any reading above 50 indicates expansion.

A measure of hiring rose to 57, the most in six months. That’s an encouraging sign for the job market because the service sector employs 90 percent of the U.S. work force, including retail, construction, health care and financial services.

Sales rose to their highest level in nearly three years. And new orders reached their highest point since February 2011. That suggests that sales for service companies will remain robust in coming months.