March job cuts add up to 27,000
Small businesses took biggest hit before full impact of virus
WASHINGTON — U.S. companies shed 27,000 net jobs in March, according to a private survey, a figure that mostly reflected the economy as it stood before the full impact of the viral outbreak.
Payroll processor ADP said small businesses took the biggest hit, losing 90,000 jobs during the period, the steepest loss since April 2009, underscoring the more-precarious outlook for those enterprises. Midsize businesses added 7,000 workers while large businesses increased payrolls by 56,000.
The median estimate in a Bloomberg survey of economists had called for a decline of 150,000. The report reflects conditions in early March to align with Labor Department figures, and doesn’t include bigger job losses that occurred later in the month.
March’s figures are the first monthly job loss reported by ADP since Hurricanes Harvey and Irma slammed Texas and much of the Southeast in September 2017. Just one month ago, ADP said that businesses gained a solid 179,000 jobs in February.
The figures highlight the abrupt reversal from consistently robust job gains as the pandemic endangers employment for millions nationwide. Even so, with many closures coming midway through the month, the worst losses are likely to still be ahead as many establishments now remain closed by the outbreak.
On Friday, the government will issue its monthly jobs report, which is expected to show a loss of about 150,000 jobs, according to FactSet. That will snap a record-long streak of 113 straight months of hiring.
Mark Zandi, chief econo
mist at Moody’s Analytics, which compiles the ADP report, said the government’s April jobs report, which will be released in early May, will probably show unprecedented job losses of roughly 10 million to 15 million, with the unemployment rate likely topping 10%.
In addition to widespread
layoffs, hiring has collapsed, which also will drag down the overall job numbers. A Moody’s survey of companies that typically finds 40% of companies hiring has fallen to a record low of just 6% of businesses adding jobs, Zandi said.
“Not only are we seeing big layoffs but obviously no one’s hiring at this point,” he said.
ADP said the figures reflect job counts during the week that ended March 14,
when the number of people seeking unemployment benefits was still largely in check.
The following week, unemployment claims exploded, soaring to 3.3 million, five times the previous record high.
Most of the job losses in the March ADP report were concentrated in a category that includes retail, which cut 37,000 jobs, and in construction, which shed 16,000. Hotels, restaurants and casinos lost 11,000 jobs.
Health care providers were still hiring, adding 44,000 jobs, while manufacturing also saw an advance, rising by 6,000.
ADP’s payroll data represent companies employing nearly 26 million workers in the U.S.