Did the slowdown in the fourth quarter of 2013 impact hiring in the first quarter of 2014? The first two jobs reports of the year certainly support that conclusion, but the latest ADP estimate of job creation suggests that the job freeze may have thawed — a bit. ADP estimates that the private sector added 191,000 jobs to the US economy in March:
Private sector employment increased by 191,000 jobs from February to March according to the March ADP National Employment Report®. Broadly distributed to the public each month, free of charge, the ADP National Employment Report is produced by ADP®, a leading global provider of Human Capital Management (HCM) solutions, in collaboration with Moody’s Analytics. The report, which is derived from ADP’s actual payroll data, measures the change in total nonfarm private employment each month on a seasonally-adjusted basis. …
Goods-producing employment rose by 28,000 jobs in March, slightly faster than an upwardly revised pace of 25,000 in February. Most of the gains came from the construction industry which added 20,000 jobs over the month; compared to an average of 16,000 during the prior three months. Manufacturers added 5,000 jobs in March, the same as February.
Service-providing employment rose by 164,000 jobs in March, up from the upwardly revised 153,000 in February. The ADP National Employment Report indicates that professional/ business services contributed the most to growth in service-providing industries, adding 53,000 jobs, slightly more than the 49,000 in February. Expansion in trade/transportation/utilities grew by 36,000, about equal to the 37,000 jobs added in February. The 5,000 new jobs in financial activities mark the strongest pace of growth in the industry since November 2013.
“The 191,000 U.S. private sector jobs added in March is slightly above the twelve-month average,” said Carlos Rodriguez, president and chief executive officer of ADP. “Hopefully, this could be a sign there is more growth to come.”
ADP originally undershot the February report, estimating 139,000 when the BLS found 175,000 jobs added to the economy. Usually, though, ADP overshoots the eventual BLS figure, as they did in January’s original projection of 175K while the BLS found only 119K. ADP is not a solidly reliable indicator, but does tend to set the expectations for the upcoming jobs report, due on Friday.
U.S. companies picked up the pace of hiring in March, signaling the dampening effects of harsh winter weather on job growth may be fading, a report by a payrolls processor showed on Wednesday.
Domestic private employers added 191,000 workers in March, slightly below economists’ expectations, while gains in the prior month were revised higher, the ADP National Employment Report showed.
“It was a nice spring rebound and we had an upward revision for February,” said Yelena Shulyatyeva, an economist with BNP Paribas in New York.
CNN Money says not so fast, almost literally:
The job market is slowly perking up after a winter lull.
Private sector employers added 191,000 jobs in March, according to payroll processing firm ADP (ADP, Fortune 500). While it was the strongest job growth in three months, it’s not much to write home about.
After a slowdown in hiring, job growth is merely back to where it was prior to the winter. …
The report was slightly disappointing to other economists, who had anticipated an even bigger bounce back after the weak winter. Those surveyed by Briefing.com expected the report to show companies added 215,000 jobs in March.
Even 215,000 would not be cause for breaking open the bubbly. These are stagnation numbers, not any indication of explosive growth. The US economy needs to add 150,000 jobs each month just to keep pace with population growth at current workforce-participation levels (which are at generational lows anyway). Adding 191,000 barely puts a dent in the unemployment crisis, and it’s doubtful that the final BLS number will be even that high.
For the last five years, the media has calculated their reaction to these numbers by comparing it to their low expectations. No one’s talking about the kind of growth that’s needed to put the millions sidelined in the stagnant economy back to work. That doesn’t make the problem go away, however, and it won’t until we put pro-growth policies in place in the tax and regulatory spheres that unlock capital and create work.