The U.S. manufacturing sector continued to recover from last year’s slump, a survey of manufacturing businesses showed Thursday.

Economic data provider IHS Markit’s manufacturing purchasing manager’s index came in at 52.4 in December, slightly down from November but still indicating that the sector is improving.

“The sustained improvement was supported by a solid rise in new business and a further upturn in production,” the IHS Markit report explained. “New business received by manufacturing firms grew at a solid rate in December, and one that was the second-strongest since April.”

Goods producers reported a third consecutive monthly upturn in new export orders, a promising sign for fourth-quarter gross domestic product.

“The US manufacturing sector continued to recover from the soft-patch seen in the summer, ending 2019 with its best quarter since the early months of 2019,” Chris Williamson, Chief Business Economist at IHS Markit said. “The overall rate of expansion nevertheless faltered somewhat in December and remains well below that seen this time last year, suggesting producers are starting 2020 on a softer footing than they had enjoyed heading into 2019.”

Cost for manufacturing businessses rose at a solid pace at the end of the fourth quarter, boosted by higher input costs and most likely pressure from the latest round of China tariffs.

The increase in new business drove firms to expand their workforce numbers in December, according to IHS Markit.

“Employment growth was the second-fastest since May, with firms stating the increase largely stemmed from greater production requirements,” IHS said.