US private sector adds more jobs than expected in September
By Michele Maatouk
Date: Wednesday 05 Oct 2022
(Sharecast News) - The US private sector added more jobs than expected in September, according to the latest data from ADP.
Employment rose by 208,000, versus expectations for a 200,000 jump and up from a revised 185,000 in August.
Small businesses with fewer than 50 employees added 58,000 jobs, while medium businesses with between 50 and 499 employees added 90,000. Large businesses with more than 500 employees created a further 60,000 jobs.
The goods-producing sector saw a 29,000 decline in jobs, while the services sector added 237,000 jobs. Within services, trade/transportation/utilities saw the biggest increase, at 147,000.
The data also showed that pay was up 7.8% year-over-year in September.
"We are continuing to see steady job gains," said Nela Richardson, chief economist at ADP. "While job stayers saw a pay increase, annual pay growth for job changers in September is down from August."
Ian Shepherdson, chief economist at Pantheon Macroeconomics, said: "This is the second round of ADP data using their new methodology; in August, their 132K print was followed by a 308K increase in the official private payroll number. Not a great start, though ADP says they aren't trying to forecast of the official payroll numbers. Right. We have no way of knowing how well the new model performs, because the historical data released by ADP have been subject to revisions; we don't know what the numbers would have been at their initial point of release, two days before the official payroll numbers. Note that the August number has just been revised up by a hefty 53K, taking it nearer the official number.
"Accordingly, we're ignoring ADP for the purposes of forecasting payrolls and strongly suggest you do, too. It's possible that over time it will become clear that the data have value, but that judgement can't be made now. Occasionally, it probably will be 'right', but consistency is what matters. The ADP report generates a lot of publicity for ADP, but it's not clear it's much use to anyone else. It's not like we have to wait long for the official numbers."
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