Private sector employment eases in the US, sharper falls predicted
By Abigail Townsend
Date: Wednesday 01 Apr 2020
(Sharecast News) - Private sector employment eased in the US last month, figures released by consultancy ADP on Wednesday showed, but is expected to fall even further in the coming weeks because of the coronavirus outbreak.
March's 27,000 slide in total US non-farm private employment compared to a gain of 179,000 in February. The March data beat consensus, comfortably beating expectations for a fall of around 150,000.
But the data were collated ahead of the introduction of more stringent lockdown measures introduced to tackle the coronavirus outbreak.
President Donald Trump, who has faced criticism for underestimating the severity of the crisis, had initially said the economy should be restarting by Easter. But on Tuesday night he adopted a more sombre tone as he warned that up to 240,000 people could die from the virus, and told Americans to prepare for a "very, very painful" two weeks.
On Tuesday, the US Covid-19 death toll rose above 3,800, exceeding that of China's.
Ahu Yildirmaz, co-head of the ADP Research Institute, which collates the data in collaboration with Moody's Analytics, said: "It is important to note that the ADP National Employment Report is based on the number of payroll records for employees who were active on a company's payroll through the 12th of the month.
"As such, the March NER does not fully reflect the most recent impact of Covid-19 on the employment situation, including unemployment claims report on 26 March."
Nearly 3.3m people registered for jobless benefits for the week ending 21 March, according to the US Department of Labor. The figure is a record high and nearly five times more than the previous record of 695,000, set in 1982.
Commenting on Wednesday's ADP figures, Ian Shepherdson, chief economist at Pantheon Macroeconomics, said: "These numbers don't matter: they capture only the leading edge of the virus hit. The pain is coming in April, when payrolls are likely to drop by perhaps 10m+.
"The labour market was in good shape before the virus, but we knew that anyway, and it's irrelevant in the face of the impending discontinuity in the data."
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