Nationally, the BNZ-BusinessNZ service index was an average one point up from December at 59.5, its highest national value since September 2015, while Otago Southland booked 64.6 in December and 64.1 for January - its fourth consecutive month in the 60s.
Points above 50 reflect expansion, and below, contraction.
While the services index reflected economic buoyancy, last week's manufacturing index for January revealed the holiday season had undermined results, leaving Otago Southland on the fence of contraction and expansion; at 51.6.
Otago Southland Employers' Association chief executive Virginia Nicholls said Otago Southland's 64.1 points for January was a ``very positive start to 2017''.
``There's sustained strong expansion in tourism, along with the supporting cafes and restaurants, which are thriving ... and services to the construction industry are very busy,'' she said.
However, the performance of the retail sector was ``mediocre'' for January, with some retailers reporting negative sales activity.
Many retailers, including the large listed companies, have been reporting a softening in sales and contraction in profit margins, often from increasing competition.
Mrs Nicholls said it was ``encouraging to see orders and new business so high, which should flow through to sales over the next few months''.
Orders/new business and activity/sales levels were both high at 66.7 points for Otago Southland, followed by employment levels at 63.3, stocks/inventories at 61.5 and supplier deliveries at 58.3.
BusinessNZ chief executive Kirk Hope said that increased activity in the services sector was across the board nationally.
``That should flow through to overall activity over the coming months,'' he said.
While the activity/sales sub-index was 60.8 and remained above the 60-point mark, new business/orders reached its highest level since January 2014 at 58, with the other three indices of employment, stocks/inventories and supplier deliveries all in expansion in a band above 50.
