ADP says companies in United States added 205000 workers in January

Private sector employment in the US increased by more than expected in the month of January, according to a report released by payroll processor ADP on Wednesday. Consensus estimate was for an increase of 193k.

Small business sector hiring at 79,000, compared to 95,000 last month.

Service employment was very strong, adding 192,000 jobs in January.

Employment in the goods-producing sector also edged up by 13,000 jobs after climbing by 30,000 jobs in the previous month. “Despite the drop this month, the underlying trend for hiring would remain solid, with the three-month moving average set at 215,000”.

Overall job creation has remained fairly strong despite a slowdown in the pace of growth in the fourth quarter. “The U.S. economy remains on track to return to full employment by mid-year”. A strong dollar and low oil prices have dampened exports and industrial output, while consumer spending, the housing market and the broader service sector have held up well, underpinning solid payroll gains.

The ADP figures come ahead of the government’s January report that is set for release on Friday with the expectation that between 180,000 and 200,000 jobs were added.

About the ADP National Employment Report® The ADP National Employment Report® is a monthly measure of the change in total US nonfarm private employment derived from actual, anonymous payroll data of client companies served by ADP®, a leading provider of human capital management solutions.

In the past five years, productivity has increased at an anemic 0.5 percent annual rate, which is much slower than the 2 percent average posted since World War II, Zandi said. ADP’s report typically (but not always), shows more jobs were created than the non-farm payroll figure. The company offers unique tools and best practices for measuring and managing risk through expertise and experience in credit analysis, economic research and financial risk management.

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