US private payrolls data improved in October, but some industries continued to reduce employment
US private payroll data rose sharply in October, but the change is unlikely to indicate any significant changes in the labor market as some industries such as professional business services lost jobs for three straight months.
Private employment increased by 42,000 jobs last month after an upwardly revised decline of 29,000 in September, the ADP National Employment Report showed on Wednesday. Economists polled by Reuters expected private employment to increase by 28,000 jobs after a previously reported decline of 32,000 in September.
“Private employers added jobs for the first time since July, but the hiring numbers were modest compared to what we reported earlier this year,” said Nela Richardson, chief economist at ADP.
Slight increases in private wages were due to the education and health services, trade, transport and utilities sectors. For the third month in a row, employers shed jobs in the professional business services, information, and leisure and hospitality industries.
The ADP report was developed in conjunction with the Stanford Digital Economy Lab. These monthly estimates have historically differed from government payroll calculations produced by the Department of Labor’s Bureau of Labor Statistics.
Even as the closely watched BLS employment report was delayed again due to the longest government shutdown on record, economists continued to urge caution when interpreting the ADP report, noting methodological differences and other limitations.
“ADP data is limited to private sector companies that rely on ADP to manage their payroll needs, so ADP data is less nationally representative,” said Matthew Martin, senior US economist at Oxford Economics. “ADP employment data should be viewed as a complement, not a replacement, for the BLS employment survey.”
The shutdown, now in its second month, delayed the September employment report, which was due on October 3. While the report could still be released when the government reopens, doubts are growing that the BLS will be able to produce the full October report due to the suspension of data collection.
The October employment report is scheduled for release on Friday. The White House warned last month that the October consumer inflation report may not be published for the first time because of the government shutdown.
Source: Reuters
