Private Survey: Companies added 253000 jobs in May
- Author: Zachary Reyes Jun 02, 2017,
Jun 02, 2017, 0:04
The private sector employment report by payrolls processor ADP showed employers added 253,000 jobs last month. This is because the hiring exceeds the roughly 80,000 people who come into the job market each month, said Mark Zandi, chief economist at Moody's Analytics. He notes that the current pace is almost three times the rate of growth of the size of the labor market.
If that's correct, wages should start to rise faster as the economic recovery from the Great Recession hits its eighth anniversary this month.
"While the claims report put a damper on what has been a pretty upbeat run for most of the recent labor market data, we still have a fairly favorable view of labor market conditions", said Daniel Silver, an economist at JPMorgan in NY.
The report, which covers 411,000 firms and 24 million workers, comes before Friday's closely-watched U.S. employment data release, although the two reports can diverge widely. April's figure was revised down from 177,000 to 174,000.
On Thursday, Fed Governor Jerome Powell signaled the US economic expansion warrants further rate hikes as it approaches full employment and inflation is moving closer to the Fed's 2-percent goal.
But ADP's figures can vary widely from the government's, as they did in March, when they reported much stronger growth, and in April, when they indicated weaker job creation.
Hiring increased in every goods-producing sector including mining and manufacturing, the report showed. Companies in that sector increased their payrolls by 37,000 in May after shedding 7,000 net positions the previous month.
The service-providing sector as a whole added 205,000 jobs last month, with gains concentrated in professional/business services (88,000 jobs), trade/transportation/utilities (58,000 jobs), education/health services (54,000 jobs), and financial activities (7,000 jobs).
The two areas showing losses were leisure and hospitality, which posted a rare decline of 11,000, and information services, which fell by 8,000.
Growth was widespread in May with businesses of all sizes seeing strong increases. That's the longest streak since 1970.
In a separate report on Thursday, the Labor Department said initial claims for state unemployment benefits jumped 13,000 to a seasonally adjusted 248,000 for the week ended May 27.
It was the 117th straight week that claims were below 300,000, a threshold associated with a healthy labor market.