Economy

ADP data show U.S. companies added 158000 jobs in June

ADP data show U.S. companies added 158000 jobs in June”

Last month, the ADP data signalled a strong increase in employment, but this was not matched by the official employment report which recorded a weaker than expected increase of non-farm payrolls of close to 138,000. The market is expecting that report to show a gain of about 180,000 jobs in June. Economists polled by Reuters predict that it will show the addition of 179,000 jobs, and an unemployment rate holding steady at 4.3 percent. "Abstracting from the monthly ups and downs, job growth remains a stalwart between 150,000 and 200,000".

We doubt that the June report signals a genuine reduction in the pace of job creation but even if the pace were to down-shift to around 150K per month this would still be sufficient to absorb any remaining slack in the labor market, with the heavy lifting having already been completed by several years of steady job creation.

The ADP report may prompt some economists to adjust their forecasts for the private payrolls tally in the June jobs report due from the Labor Department on Friday, where the median estimate is for a gain of 170,000.

The Bureau of Labor Statistics' report will also include information on wage growth.

According to ADP, there was an increase in employment of 17,000 for small companies, 91,000 for mid-sized companies and 50,000 for large companies and there will be some concerns that hiring at small companies appears to have slowed.

All of the June jobs in the ADP/Moody's count came from services, with professional and business positions showing the biggest gain at 69,000. The PayScale Index, which updated today, shows that USA wages grew 0.5 percent between Q1 and Q2 2017. The buying power of workers' wages is 7.4 percent lower today than it was in 2006. Share your thoughts in the comments or join the conversation on Twitter.



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