Private Sector Added 217,000 Jobs in November
Private-sector payrolls increased more than expected in November, the most in five months and the latest indication of steady U.S. job growth. Private payrolls in the U.S. rose by 217,000, said payroll processor Automatic Data Processing Inc. and forecasting firm Moody's Analytics. The report is based on data collected from ADP clients in addition to lagged government data. Economists surveyed by The Wall Street Journal expected an increase of 192,000. Meanwhile, the October gain was revised up to 196,000 from 182,000. "Job growth remains strong and steady," said Mark Zandi, chief economist of Moody's Analytics. According to Jim O'Sullivan, chief U.S. economist at High Frequency Economics, the ADP data continued to show no sign of significant slowing in hiring, and "that is also the message from jobless claims," a proxy for layoffs across the nation that are near a four-decade low. The November ADP increase was primarily thanks to the service sector, which accounts for most of the economy's jobs and has been offsetting a weak manufacturing sector. Service-providing firms added 204,000 positions last month--the most since June and up from 174,000 in October. A rebound in professional and business-service hiring powered the rise. In the manufacturing sector, firms snapped a two-month streak of job cuts and added 6,000 employees in November. Employers in manufacturing have eliminated positions as a strong dollar, weak energy prices and a softer global economy have sapped demand. Construction firms hired 16,000 employees. Small businesses continued to add the most employees, though medium and big businesses also added solid amounts of workers. Companies with at least 500 employees picked up hiring after taking a breather in October, hiring twice the amount of workers in November as they added in the previous month. The ADP report comes ahead of the Bureau of Labor Statistics's employment-situation report, due out Friday morning and the last monthly jobs snapshot before the Federal Reserve's December interest-rate decision. ADP lags behind the government's initial private payroll estimate by a month. In October, the initially reported ADP figure fell 87,000 short of the BLS number; in September, ADP came in 81,000 ahead of the government's figure. Economists polled by The Wall Street Journal expect the BLS to report an increase of 200,000 nonfarm payrolls for November, down from the much stronger-than-expected 271,000 reported in October. Economists project that the unemployment rate, which unexpectedly dipped in October, will hold steady at 5%.