U.S. Companies Added 102,000 Workers in June, ADP Data Show

(Bloomberg) -- Hiring at U.S. companies rebounded less than forecast in June, according to a private report that may signal tepid payroll growth ahead of the government’s monthly jobs report Friday.

Private payrolls increased by 102,000 after an upwardly revised 41,000 in May, according to ADP Research Institute data released Wednesday. That fell below almost all estimates in a Bloomberg survey of economists that had called for 140,000 jobs.

Key Insights

• The report signals a cooling trend just ahead of the Labor Department’s June employment report Friday, which is projected to show nonfarm payroll growth picked up to 164,000 while the jobless rate held at a 49-year low of 3.6%. ADP had previously reported the May reading at 27,000, though even with revision the tally remains the weakest number since 2010.
• Goods-producing jobs shrank by 15,000, driven by an 18,000 loss for construction. Service-provider employment increased by 117,000.
• A separate report from Labor Wednesday showed filings for U.S. unemployment benefits declined for the second time in three weeks, a more encouraging sign for the job market.

Economist’s View

• “The job market continues to throttle back,” Mark Zandi, chief economist at Moody’s Analytics Inc., said in a statement. Moody’s produces the figures with ADP. “Job growth has slowed sharply in recent months, as businesses have turned more cautious in their hiring. Small businesses are the most nervous, especially in the construction sector and at bricks-and-mortar retailers.”

Get More

• Gains in services were generally broad-based with education and health services climbing by 55,000.
• The report showed that small business payrolls contracted by 23,000 while medium-sized firms and large companies saw growth of 60,000 and 65,000 respectively.
• ADP’s payroll data represent about 411,000 firms employing nearly 24 million workers in the U.S.

To contact the reporter on this story: Ryan Haar in Washington at rhaar3@bloomberg.net

To contact the editors responsible for this story: Scott Lanman at slanman@bloomberg.net, Jeff Kearns, Margaret Collins

©2019 Bloomberg L.P.