ADP July National Employment Report: +200K Private Sector Jobs, June Revised Up 10K to 198K; See Conference Call Notes
June’s ADP report came in at 188,000 private-sector jobs added. Predictions for July are:
The report will be here at 8:15 a.m. I will live-blog ADP’s 8:30 a.m. conference call. I would think that Mark Zandi is also going to talk a little bit about GDP on that call.
Here we go (direct link):
Private-sector employment increased by 200,000 from June to July, on a seasonally adjusted basis.
Highlights:
- Small businesses (1-49 employees) +82,000
- Medium businesses (50-499 employees) +60,000
- Large businesses (500 or more employees) +57,000
June was revised up by 10,000 to 198,000.
More, from the press release (may load slowly):
Mark Zandi, chief economist of Moody’s Analytics, said, “Job growth remains remarkably stable. Businesses are adding to payrolls in most industries and across all company sizes. The job market has admirably weathered the fiscal headwinds, tax increases and government spending cuts. This bodes well for the next year when those headwinds are set to fade.”
CONFERENCE CALL NOTES coming up, starting at 8:30 (my spur-of-moment thoughts in italics):
MARK ZANDI: Very consistent with job growth in past 36 months averaging 200K/month.
Broad-based across most industries, with weakness in mfg. due to cuts in defense outlays relating to sequestration and weakness in exports.
Solid gain in construction (over 20K). Also strong in companies of various sizes.
No significant evidence of health care reform impact, (evidence “evaporated” in the summer), or that bizzes are moving people from FT to PT. PT pickup is only evidence of volatility not of significant pickup.
Job growth is skewed to lower-wage jobs. Leisure and hospitality, retail, and professional services. 60% of job growth since early 2010 has been in the low wage category, bottom one-third of pay scale. Job growth very weak in middle-paying jobs (mfg and govt).
Not unusual to see this weighting early in a recovery. (EARLY???)
Sequestration is having an impact, most pronounced in defense outlays.
Still thinks Fed will start tapering in September, consistent with the script laid out in past few months.
Quite impressive in the context of the fiscal drag and other headwinds.
Q&A session —
Professional and biz services (+49K) (remember, that includes temps) is more consistent with what BLS has been reporting. It’s a melange of many disparate industries. Fair to say that in general it’s a sign of strength that this sector has strong job growth. Many areas with prof services are not that great in productivity, possibly explaining why GDP growth is weak vs. employment growth.
Doesn’t think employer mandate delay in Obamacare is affecting things yet. Hard to conclude that there’s any meaningful impact on job market of health care reform (but what about what employers haven’t done to grow their businesses?), despite business complaints. Doesn’t expect to see any Ocare impact for the rest of the year. Has been looking for it, and it’s not in the data.
Zero Hedge also believes that a number like this confirms that the Fed will start to taper.
