The high-quality development of the service industry is related to the service industry itself, and it will also promote the high-quality development of the manufacturing industry through industrial linkage. In 2010, China launched a comprehensive reform policy for the service industry, which has promoted the systematic optimization of the institutional system and development environment in the service industry through institutional reform measures such as relaxing market access for the service industry, promoting the reform and restructuring of state-owned and public institutions, and deepening the opening up of the service industry to the outside world, thus providing favorable conditions for the high-quality development of the service industry. From the perspective of industrial linkages, the comprehensive reform of the service industry may affect the development of the manufacturing industry through the service industry. Existing research on the relationship between the service industry and the manufacturing industry is relatively large, but there is a lack of exploring the impact of the development of the service industry on the total factor productivity of the manufacturing industry from the perspective of the comprehensive reform of the service industry. Based on this, this paper explores the policy effect and mechanism of service industry development on the total factor productivity of the manufacturing industry from the implementation of the comprehensive reform policy of the service industry. By analyzing the data of listed manufacturing companies in Shanghai and Shenzhen A-share exchanges from 2007 to 2019, the PSM-DID method was used for empirical testing. The research results indicate that the comprehensive reform of the service industry has effectively improved the total factor productivity of manufacturing enterprises, and this result still holds through a series of robustness tests. Mechanism analysis shows that the comprehensive reform of the service industry improves the total factor productivity of manufacturing enterprises by reducing production costs, improving innovation ability, and promoting the integration of the two industries. In addition, heterogeneity testing finds that the comprehensive reform of the service industry has more significant economic effects in regions with higher levels of marketization, knowledge-intensive and technology-intensive manufacturing enterprises, and larger-scale manufacturing enterprises. Compared to previous literature, this article expands on the following three aspects. Firstly, most of the existing studies focus on exploring the impact of the comprehensive reform of the service industry on the service industry, but less attention is paid to the total factor productivity (TFP) of the manufacturing industry. This article analyzes the impact of the comprehensive reform of the service industry on the TFP of the manufacturing industry, thereby expanding the research on the economic effects of the comprehensive reform of the service industry. Secondly, this article analyzes the internal mechanism of the comprehensive reform of the service industry and its impact on manufacturing TFP through the service industry, and uses microdata for empirical testing, enriching the relevant theoretical basis and empirical research on the development of the service industry. Thirdly, this article adopts the PSM-DID method, which deals with the endogeneity issue more effectively and overcomes the limitations of traditional single indicators that cannot be fully characterized, thereby revealing more scientifically the causal relationship between the comprehensive reform of the service industry and the TFP of the manufacturing industry. This article, from the perspective of the comprehensive reform of the service industry, reveals the promoting effect of service industry development on the total factor productivity of the manufacturing industry, provides a policy basis for government departments to build an institutional environment that adapts to the development of the service industry, and also provides ideas and directions for accelerating the improvement of total factor productivity of manufacturing industry and building a modern industrial system.