The ADP National Employment Report beat expectations again this month, reflecting the addition of 205,000 jobs to private payrolls from December to January, according to the payroll processor. Prior to the release of the report, economists polled by Reuters were predicting average gains of 195,000 jobs.
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Predictions varied widely, however, with some economists predicting as few as 160,000 jobs added and others as much as 235,000, and January’s report was significantly lower than December‘s unexpected blockbuster tally of 257,000 jobs. (Upwardly revised, in this report, to 267,000 jobs.)
“One of the main reasons for lower overall employment gains in January was the drop off in jobs added at the largest companies compared to December. These businesses are more sensitive to current economic conditions than small and mid-sized companies,” said Ahu Yildirmaz, VP and head of the ADP Research Institute, in a statement. “Over the past year, businesses with less than 500 employees have created nearly 80 percent of new jobs.”
Small businesses with fewer than 50 employees added 79,000 jobs last month, while midsized businesses with 50 – 499 employees added 82,000 jobs. Large businesses with 500 or more workers added 44,000 jobs.
Professional and business services added 44,000 jobs in January, while trade, transportation, and utilities added 35,000 jobs. Financial activities added 19,000 jobs – the most since March 2006. Construction added 21,000 jobs, while manufacturing neither gained nor lost jobs.
“Job growth remains strong despite the turmoil in the global economy and financial markets,” said Mark Zandi, chief economist of Moody’s Analytics, which produces the report with ADP. “Manufacturers and energy companies are reducing payrolls, but job gains across all other industries remain robust. The U.S. economy remains on track to return to full employment by mid-year.”
On Friday morning, the Bureau of Labor Statistics will provide its monthly employment report, which includes public and private payrolls, as well as unemployment rates and wage growth. Reuters reports that economists are looking for 190,000 jobs added, compared with 292,000 from the previous month.
The PayScale Index, which measures the change in wages for employed U.S. workers, forecasts a 1.4 percent year-over-year increase in pay for Q1 2016.
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