February job growth crushes estimates

ADP says 298,000 jobs added, blowing past 189,000 forecast

A labor- market survey on Wednesday provided the latest signal that job growth is strengthening along with business confidence.

Payroll processor ADP said businesses added 298,000 private- sector jobs in February, significantly above the 189,000 forecast. The figure was the latest positive reading on the labor market following a strong hiring report from LinkedIn, low jobless claims and a surge in service- sector activity.

Together, the indicators are stoking expectations for Friday’s survey from the Labor Department, which counts both private and government jobs. That report is projected to show 190,000 payroll gains, according to a Bloomberg survey of economists.

The data “indicate that the U. S. job market is in very good shape at the beginning of 2017,” Gus Faucher, an economist with PNC Financial Services Group, wrote in a note to clients.

If it were sustained, stronger- thananticipated job growth would push the unemployment rate down more rapidly, likely spurring faster interest rate hikes by the Federal Reserve.

After the ADP report, Ian Shepherdson, chief economist of Pantheon Macroeconomics, raised his forecast for Labor Department’s tally to 250,000 job gains from 200,000.

While average monthly employment gains fell to 180,000 in 2016 from 226,000 the prior year, Shepherdson said he expected 200,000- plus advances to be the average “for the foreseeable future.”

That view differs from the belief of many economists that the low 4.8% unemployment rate is supplying employers with fewer workers, tempering hiring.

ALAN DIAZ, AP Hiring was strong in January, and many economists expected another strong showing for February. Career fairs, like this one, have been bustling.