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United States private employers added 749,000 jobs in September, payroll services firm ADP said on Wednesday, September 30, as employment continues to rebound following the economic hit caused by the coronavirus downturn.
The report was above analysts’ expectations and came ahead of the release on Friday, October 2, of the September unemployment rate by the Labor Department, the last before voters decide whether to give President Donald Trump a second term in the November election.
The business shutdowns beginning in March to stop COVID-19 did grievous harm to the economy, but ADP showed recovery in hard-hit sectors like leisure and hospitality, which added 92,000 jobs, and manufacturing, which added 130,000.
However, despite the report’s health, the Labor Department has been reporting weekly jobless claims hovering at levels well above the single worst week of the 2008-2010 global financial crisis, and Rubeela Farooqi of High Frequency Economics warns the employment crisis may not be over yet.
“The rebound in economic activity has been more muted recently and the risk remains that full recovery of jobs – especially in the service sector – will be a prolonged process, one that is primarily dictated by the virus,” she said.
Hiring was seen in businesses of all sizes, ADP said, with large businesses of 500,000 employees or more adding 297,000 jobs, while small businesses with 49 employees or less added 192,000. Medium-sized enterprises added 259,000.
The services-providing sector made up the bulk of the hiring gains, with 552,000 jobs added, while goods producers added 196,000.
Economists view the ADP data as a preview of the monthly Labor Department employment report due out Friday that encompasses both private and government hiring.
Ian Shepherdson of Pantheon Macroeconomics said the ADP data predicts a gain of 950,000 private sector jobs in the Labor Department report, which would be less than August.
He warns other indicators “point to significantly weaker payrolls in October, and perhaps even the first outright decline since April.”
The Commerce Department separately released its final estimate for 2nd quarter US gross domestic product, revising that quarter’s historic collapse slightly upwards to 31.4%, still the worst result in recent times. – Rappler.com