Companies added more workers than forecast in August, easing concern the U.S. job market may be stalling, a private report based on payrolls showed.
The 201,000 increase in employment, the biggest gain in five months, followed July’s revised 173,000 rise, Roseland, New Jersey-based ADP Employer Services said today. The median forecast of 41 economists surveyed by Bloomberg called for an advance of 140,000.
A sustained pickup in hiring would help generate the wage gains needed to spur consumer spending, the biggest part of the economy.
A Labor Department report tomorrow may show private payrolls rose by 138,000 in August, and unemployment held at 8.3 percent, according to the median forecast in a Bloomberg survey.
The ADP figure is “good news for the economy if it turns out to be correct,” Joel Naroff, president of Naroff Economic Advisors Inc. in Holland, Pennsylvania, said in an e-mail to clients.
“We may not be seeing a deluge of new jobs but it clearly looks like firms are hiring again.” Estimates in the Bloomberg survey ranged from 90,000 to 170,000. Another report today showed fewer Americans than forecast filed applications for jobless benefits last week.
Jobless claims dropped by 12,000 to 365,000 in the week ended Sept. 1, the lowest in a month, the Labor Department reported.
Stock-index futures held gains after the labor market figures. The contract on the Standard & Poor’s 500 Index expiring this month rose 0.5 percent to 1,409.9 at 8:38 a.m. in New York.
ADP Compared
Since April 2010, ADP’s initial estimate has either overstated or understated the Labor Department’s initial reading on private payrolls by 69,000 on average.
The average miss for the Bloomberg survey’s median forecast of economists was 58,000. Goods-producing industries, which include manufacturers and construction companies, increased payrolls by 16,000, today’s figures showed.
Employment in construction rose 10,000, while factories added 3,000 jobs. Service providers took on 185,000 workers, up from 156,000 a month earlier.
Companies employing more than 499 workers added 16,000 jobs. Medium-sized businesses, with 50 to 499 employees, added 86,000 and small companies increased payrolls by 99,000, ADP said.
The Labor Department’s report tomorrow may show overall hiring, which includes government jobs, climbed 127,000 last month after rising 163,000 in July, according to the Bloomberg survey median. The jobless rate has held above 8 percent since February 2009.
Fed’s Bernanke
“The stagnation of the labor market in particular is a grave concern,” Federal Reserve Chairman Ben S. Bernanke said in an Aug. 31 speech in Jackson Hole, Wyoming. Persistently high unemployment “will wreak structural damage on our economy that could last for many years.”
St. Jude Medical Inc., a maker of heart rhythm devices, last month said it is firing 300 workers in a reorganization to save $50 million to $60 million in annual pretax expenses starting next year.
Others trimming their workforce include Edison International (EIX), owner of California’s second-largest electric utility, which will reduce staff at its shuttered San Onofre nuclear plant by about 730 positions by the fourth quarter.
The ADP report is based on data from businesses with more than 21 million workers on payrolls. Macroeconomic Advisers LLC in St. Louis produces the data with ADP.
bloomberg.com
The 201,000 increase in employment, the biggest gain in five months, followed July’s revised 173,000 rise, Roseland, New Jersey-based ADP Employer Services said today. The median forecast of 41 economists surveyed by Bloomberg called for an advance of 140,000.
A sustained pickup in hiring would help generate the wage gains needed to spur consumer spending, the biggest part of the economy.
A Labor Department report tomorrow may show private payrolls rose by 138,000 in August, and unemployment held at 8.3 percent, according to the median forecast in a Bloomberg survey.
The ADP figure is “good news for the economy if it turns out to be correct,” Joel Naroff, president of Naroff Economic Advisors Inc. in Holland, Pennsylvania, said in an e-mail to clients.
“We may not be seeing a deluge of new jobs but it clearly looks like firms are hiring again.” Estimates in the Bloomberg survey ranged from 90,000 to 170,000. Another report today showed fewer Americans than forecast filed applications for jobless benefits last week.
Jobless claims dropped by 12,000 to 365,000 in the week ended Sept. 1, the lowest in a month, the Labor Department reported.
Stock-index futures held gains after the labor market figures. The contract on the Standard & Poor’s 500 Index expiring this month rose 0.5 percent to 1,409.9 at 8:38 a.m. in New York.
ADP Compared
Since April 2010, ADP’s initial estimate has either overstated or understated the Labor Department’s initial reading on private payrolls by 69,000 on average.
The average miss for the Bloomberg survey’s median forecast of economists was 58,000. Goods-producing industries, which include manufacturers and construction companies, increased payrolls by 16,000, today’s figures showed.
Employment in construction rose 10,000, while factories added 3,000 jobs. Service providers took on 185,000 workers, up from 156,000 a month earlier.
Companies employing more than 499 workers added 16,000 jobs. Medium-sized businesses, with 50 to 499 employees, added 86,000 and small companies increased payrolls by 99,000, ADP said.
The Labor Department’s report tomorrow may show overall hiring, which includes government jobs, climbed 127,000 last month after rising 163,000 in July, according to the Bloomberg survey median. The jobless rate has held above 8 percent since February 2009.
Fed’s Bernanke
“The stagnation of the labor market in particular is a grave concern,” Federal Reserve Chairman Ben S. Bernanke said in an Aug. 31 speech in Jackson Hole, Wyoming. Persistently high unemployment “will wreak structural damage on our economy that could last for many years.”
St. Jude Medical Inc., a maker of heart rhythm devices, last month said it is firing 300 workers in a reorganization to save $50 million to $60 million in annual pretax expenses starting next year.
Others trimming their workforce include Edison International (EIX), owner of California’s second-largest electric utility, which will reduce staff at its shuttered San Onofre nuclear plant by about 730 positions by the fourth quarter.
The ADP report is based on data from businesses with more than 21 million workers on payrolls. Macroeconomic Advisers LLC in St. Louis produces the data with ADP.
bloomberg.com
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