March ADP Private Sector Employment Report and Conference Call (040214): 191K Jobs Added (See Call Notes)
- Bloomberg is vague — “A report from ADP Research Institute at 8:15 a.m. New York time will probably show that U.S. companies added more workers last month than in February.” February’s adds were 139,000.
- Business Insider is specific — 195,000 private-sector jobs.
I also came across a prediction at Reuters that Friday’s jobs report will come in with 200,000 seasonally adjusted job additions. Additionally, Business Insider reports that “optimism is building that the number could come in significantly higher.”
Separately, the press is treating a 5.7 percent pickup in year-over-year auto sales after three basically flat months as some kind of wondrous snapback from bad weather. It did beat amazingly depressed expectations of a 2 percent rise.
The ADP report will be here at 8:15. I’ll sit in on the conference call after that.
HERE IT IS (direct link):
Private-sector employment increased by 191,000 from February to March, on a seasonally adjusted basis.
- Small businesses (1-49 employees) +72,000
- Medium businesses (50-499 employees) +52,000
- Large businesses (500 or more employees) +67,000
“The 191,000 U.S. private sector jobs added in March is slightly above the twelve-month average. Hopefully, this could be a sign there is more growth to come.”
– Carlos Rodriguez, president and chief executive officer of ADP
From the press release:
Total U.S. Nonfarm Private Employment: 191,000
By Company Size:
- Small businesses: 72,000
— 1-19 employees 38,000
— 20-49 employees 34,000
- Medium businesses: 52,000
— 50-499 employees 52,000
-Large businesses: 67,000
— 500-999 employees 14,000
— 1,000+ employees 53,000
- Goods-producing 28,000
- Service-providing 164,000
- Construction 20,000
- Manufacturing 5,000
- Trade/transportation/utilities 36,000
- Financial activities 5,000
- Professional/business services 53,000
… Mark Zandi, chief economist of Moody’s Analytics, said, “The job market is coming out from its deep winter slumber. Job gains are consistent with the pace prior to the brutal winter. The gains are broad based across industries and business size classes. Even better numbers are likely in coming months as the weather warms.”
I’m interpreting Zandi to say that March came back to where things had been but that there was no make-up effect from the winter.
Prior month adjustments:
- February — from 135K to 178K.
- January — from 127K to 121K.
- December — unchanged.
Slowdown in the job market and the economy was due to weather. Now with more typical weather, numbers will return to growth rates we have been experiencing before.
Suggestive of economic growth close to 3% GDP growth (presumably for year).
Key to even better job growth is more hiring. Layoffs are low. Job vacancies aren’t that much lower than they were before the recession. Some lack of confidence and job skills mismatch.
Job gains are broad based across pay scales and company sizes. Not stellar but consistent.
Even though unemp rate is now elevated, we’re getting to the point where wage growth is now showing some early signs of picking up, meaning that in some parts of the country the labor market is tightening.
- FROM ME re GDP and Feb. improvement to March — GDP 3% prediction is for whole year. First quarter will be about 1.5%. All things together suggest that weather effects were pronounced. Subsequent quarters will be above 3% to make up for lower first quarter.
- From Richard (couldn’t tell last name) re BLS Friday and jobless rate — Zandi predicts 185K with a few govt. layoffs. Hope for 225K+ in subsequent months. Unemp rate might tick down to 6.6%. At current rate of job growth, even if workforce participation stabilizes, it will slow the progress of unemp rate decline but not stop it. 2015 at 5.7%, 2016 at 5.5%, which he called full employment (you’re kidding — Ed.).
- Gabrielle re lag in small biz job growth and zero adds in 20-49 employees — Zandi says key to small biz recovery is housing industry. Should see more improvement in housing market, auguring well for small biz growth. Job creation at new businesses remains very, very low by historical standards. Job growth at fast-growing startups isn’t happening, which foreshadows employment growth problems in the coming years.