U.S. factory activity expanded for a sixth straight month in December, with growth surging beyond market expectations to its most robust month in two decades, in a sign that the economic recovery continues to gain ground.

The Institute for Supply Management (search) said on Friday its barometer of manufacturing activity jumped to 66.2 in December from 62.8 in November, which at the time was the highest since 1983.

Wall Street economists had forecast the index at 61.0, looking for expansion to stabilize from last month's sizzling level.

A reading above 50 in the index signals growth in the factory sector, which has been slow to recover from a recession that officially ended in November 2001.

New orders, often seen as reflective of future growth, rose to 77.6 from 73.7 while the employment index jumped to 55.5 from 51.0. Prices paid rose to 66.0 from 64.0.

Reuters and the Associated Press contributed to this report.