The seasonally adjusted Nikkei Japan Services Purchasing Managers Index slipped to 51.2 in November from 53.4 in October as business activity growth weakened, IHS Markit data showed Dec. 5.
The index, however, managed to stay above the 50-point mark, which indicates an expansion, for the 14th consecutive month.
Despite weak growth in business activity, new orders increased at their quickest pace in 44 months.
Service sector companies were hit by increased costs in November owing to higher labor expenses. Input price inflation rose for the fourth month in succession to the joint-sharpest since August 2008, on par with September of that year.
The sector maintained an upbeat outlook, with the level of optimism climbing to a six-month high in November.
Meanwhile the Nikkei Composite Output Index, which covers both services and manufacturing, fell to 52.2 in November from 53.4 in October.
