April 05, 2017

ADP: Businesses add booming 263,000 jobs in March

Businesses added 263,000 jobs in March, payroll processor ADP said Wednesday, possibly heralding a third straight month of strong hiring in the government’s closely watched employment report later this week.

Economists surveyed by Bloomberg expected ADP to report 185,000 new private-sector jobs. They expect the Labor Department on Friday to tally gains of 175,000 in the public and private sectors.

"The ADP survey is clearly another indication that, despite the apparent slowdown in (economic) growth in the first quarter, labor market conditions have remained unusually strong," economist Andrew Hunter of Capital Economics wrote in a note to clients.

ADP tries to foreshadow Labor’s report but often varies from it noticeably. In February, ADP recorded 298,000 payroll gains among businesses while Labor reported 227,000, and 235,000 total additions, including government hiring.

Some economists say unusually warm winter weather pulled forward hiring in sectors such as construction to early this year. That could spell relatively subdued job gains in the spring, especially since snowstorms may have posed a further hindrance to hiring in March.

ADP typically counts employees as working as long as they’re on the payroll, but Labor only includes those who are working when it conducts its survey, notes Jim O’Sullivan, chief U.S. economist of High Frequency Economics. As a result, Labor’s reported payroll gains, unlike ADP’s, could be depressed by weather effects.

Generally, the 200,000-plus monthly job gains so far this year have soundly beat the estimates of economists who figured the low, 4.7% unemployment rate would slow hiring by providing employers with fewer available workers.

In March, ADP said, professional and business services led the job gains with 57,000. Leisure and hospitality added 55,000; construction, 49,000; health care, 46,000; and trade, transportation and utilities, 34,000.

Manufacturers added 30,000 jobs as the oil upturn and improving global economy continue to stoke a healthy rebound for the nation’s factories.

"Job growth is off to a strong start in 2017," said Mark Zandi, chief economist of Moody's Analytics, which helps ADP compile the report. "The gains are broad based but most notable in the goods producing side of the economy including construction, manufacturing and mining."

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