WASHINGTON – U.S. manufacturing expanded in February at the fastest pace since June 2011, buoyed by increases in new orders and production. The third straight month of growth suggests factories may help the economy this year after slumping through most of 2012.

The Institute for Supply Management said Friday that its index of factory activity rose last month to 54.2, up from January's reading of 53.1. A reading above 50 indicates expansion. The ISM is a trade group of purchasing managers.

A measure of new orders rose to the highest level since April 2011. Factories added jobs, the report said, but at a slower pace than the previous month.