Wednesday, February 2, 2011

ADP Employment Report: Private Payrolls Up 187,000

In January, according to the ADP Employment Report, private sector payrolls rose by 187,000. This follows a downwardly revised gain of 247,000 jobs in December (previously reported to be a gain of 294,000). January’s gain, though not as large as in December, signifies a significantly faster pace of job growth than what occurred in most of the past year. The labor market is continuing to improve. Even so, this growth is still relatively modest. Payrolls must grow about 125,000 to 150,000 per month just to absorb new entrants to the labor market. Therefore, in order to drive down the unemployment rate significantly, private sector payrolls will have to grow at a faster pace for a prolonged period.

The increase over the month was driven by gains in service sector jobs, which rose by 166,000. However, goods producing jobs also expanded, adding 21,000 to payrolls. Manufacturing added 19,000 jobs, the third straight month of expansion. Notably, for the first time during the recovery, non-manufacturing goods producing jobs, which are dominated by construction, added slightly to payrolls. The downsizing of the construction industry may be nearing an end.

Ch. in Payrolls ('000s)JanDecNovOctSepAug
    Goods Producing212212-20-27-18

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