U.S. Companies Added 213,000 Workers in January, ADP Data Show

(Bloomberg) -- Companies added more workers than forecast to U.S. payrolls in January, signaling a healthy start to the year for the job market despite the partial government shutdown.

Private payrolls increased by 213,000 after a downwardly revised 263,000 gain in December, according to data released Wednesday from the ADP Research Institute in Roseland, New Jersey. The median forecast in a Bloomberg survey of economists called for 181,000.

Key Insights

• The results bode well for private payrolls that have been contributing to overall employment growth -- a trend that may be reinforced in the monthly jobs report due from the Labor Department on Friday.
• The figures showed gains in almost all industries except natural resources and mining. Manufacturing added 33,000 workers, the most since 2014, while hiring in construction increased to a one-year high of 35,000. Service providers added 145,000 workers.
• Demand for labor continues to be solid, with employers also reluctant to fire workers, though the outlook is clouded by uncertainty over the trade war with China and softening global growth.
• The hiring environment may also have been affected by the five-week government shutdown that ended Friday.

Economist’s View

“The job market weathered the government shutdown well,” Mark Zandi, chief economist at Moody’s Analytics Inc. in West Chester, Pennsylvania, said in a statement. Moody’s produces the figures with ADP. “Despite the severe disruptions, businesses continued to add aggressively to their payrolls. As long as businesses hire strongly the economic expansion will continue on.”

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• Professional and business services expanded by 46,000 jobs while education and health services added 38,000 workers.
• Companies employing 500 or more workers increased staffing by 66,000 jobs; payrolls grew by 84,000 at medium-sized businesses, or those with 50 to 499 employees; and small companies’ payrolls gained 63,000.

--With assistance from Chris Middleton.

To contact the reporter on this story: Shobhana Chandra in Washington at schandra1@bloomberg.net

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

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