Hiring rebound seen
Private sector added 216,000 jobs, report says
The private sector added 216,000 jobs in November, payroll processor ADP said Wednesday, possibly signaling the government this week will report a strong rebound in hiring after last month’s modest gains.
Economists expected 169,000 job gains, according to a Bloomberg survey. They predict the Labor Department on Friday will record 180,000 additional jobs in the public and private sectors.
That report will be the last before the Federal Reserve considers an anticipated interest rate hike at a mid-December meeting. The Fed has held its key rate steady since raising it in late 2015 for the first time in nine years.
ADP tries to predict Labor’s private-sector job gains and came within 5,000 in October, but has missed by an average of more than 35,000 the past two years.
In November, small businesses added 37,000 jobs, midsize ones 89,000 and large companies 90,000.
Trade, transportation and utilities led the gains, with 69,000, in a sign that retailers brought on holiday staffs early this year because of the tight labor market. Professional and business services added 68,000 jobs, education and health care 43,000 and leisure and hospitality 38,000. Construction companies added 2,000 jobs and manufacturers, still beset by the oil industry’s troubles and a sluggish global economy, cut 10,000.
“Businesses hired aggressively in November and there is little evidence that the uncertainty surrounding the presidential election dampened hiring,” said Mark Zandi, chief economist of Moody’s Analytics, which helps ADP compile the report.
Zandi said retail hiring for the winter holiday shopping season was especially strong, even after seasonal adjustments intended to offset those effects. That suggests retailers may be ramping up their temporary hiring efforts earlier to ensure they can find enough workers, he said.
By one measure, home prices nationwide have finally surpassed their bubble-era peaks, boosting household wealth. And there are signs wages are picking up after years of sluggish growth.
“Overall, consumers are
feeling confident and are driving the strong performance we currently see in the job market,” Ahu Yildirmaz, head of the ADP Research Institute, said.
Hurricane Matthew, which buffeted the Southeast in October, appeared to suppress employment gains somewhat in Labor’s report that month because the government only counts those workers who are paid during the week it conducts its survey. As a result, there could be a positive snapback effect in its November survey, says economist Andrew Hunter of Capital Economics. ADP, by contrast, counts workers as long as they’re on the payroll and so was likely unaffected by the storm and its aftereffects.
Overall, average monthly job gains have slowed to 181,000 this year from 229,000 in 2015. Economists say that’s a natural byproduct of a near-normal 4.9% unemployment rate that spells fewer available workers for employers.