Contrary to an anxiety-inducing vision built by layoffs backed by tech giants, 42,000 US private sector jobs were added in October, as per payroll provider ADP’s latest data. Figures released Wednesday (US time), marked the first positive growth in three months.
They also confirmed that annual pay was up 4.5% year-over-year for those who stayed in their jobs, marking no upward growth as it was the same as recorded in September. On the other hand, those who switched their jobs encountered a 6.7% increase, recording a slight rise from earlier.
“Private employers added jobs in October for the first time since July, but hiring was modest relative to what we reported earlier this year,” said Dr Nela Richardon, chief economist, ADP, in a statement. ““Meanwhile, pay growth has been largely flat for more than a year, indicating that shifts in supply and demand are balanced.”
Produced after a collaboration between ADP Research and the Stanford Digital Economy Lab, the October ADP National Employment Report took into account the “anonymised weekly payroll data of more than 26 million private-sector employees in the United States.” Despite the lack of official federal jobs data amid what is now the longest US government shutdown in history, ADP stood in as the “trusted source for essential data,” according to a LinkedIn post by Darryl Louisaire, the Major Account Specialist at ADP.
October job market: US private jobs added more than previous expectations
The upward swing across industries was larger than over 20,000 forecasters had predicted, as per a survey of economists by Dow Jones Newswires and The Wall Street Journals. According to FactSet, economists had previously expected an addition of 37,500 jobs, as opposed to Wednesday’s numbers surpassing 40,000.
The job market rebound overturned the previous loss of 29,000 jobs in September. Revised data showed that job losses that month weren’t as high as ADP had initially estimated (32,000). However, Richardson still warned that the pace of hiring was much slower than earlier this year. “That recovery is tepid, and it is not broad-based,” the ADP chief economist said during call with reporters, as quoted by CNN.
Private job market gains and losses detailed
ADP’s estimates indicated that job creation was amplified by companies employing at least 250 workers. “While big companies make headlines, small companies drive hiring,” Richardson told CNBC. “So to see that weakness at the small company level is still a concern, and I think that’s one of the reasons why the recovery has been so tepid.”
The report showed that the biggest job gains came from trade, transportation and utilities (+47,000); education and health services (+26,000); and financial activities (+11,000). On the flip side, the most concerning losses were witnessed in information (-17,000 jobs), professional and business services (-15,000), and leisure and hospitality (-6,000).
What is ADP?
The payroll provider’s estimates work as a proxy for the official months jobs report released by the Bureau of Labor Statistics. They have especially gained a significant position amid the ongoing government shutdown, which resulted in the suspension of such data releases last month, with the same expected this month.
ADP’s official website states: “We are a comprehensive global provider of cloud-based human capital management (HCM) solutions that unite payroll, HR, talent, time, tax and benefits, and a leader in business outsourcing services and analytics. Our experience, deep insights, and cutting-edge technology have transformed human resources from a back-office administrative function to a strategic business advantage.”
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