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Economy in Brief

U.S. ADP Private Payroll Increase Strengthens
by Tom Moeller  November 30, 2016

The ADP/Moody's National Employment Report indicated that nonfarm payroll employment increased 216,000 during November following a 119,000 October rise, revised from 147,000. The September increase of 196,000 also was revised down from 202,000. The latest was the largest increase since June. So far this year, payrolls rose an average 176,000 per month, down from 209,000 averaged during 2015, and 237,000 averaged in 2014. The latest increase compared to expectations for a 160,000 rise in the Action Economics Forecast Survey. During the last ten years, there has been a 96% correlation between the change in the ADP figure and the change in nonfarm private sector payrolls as measured by the Bureau of Labor Statistics.

The Automatic Data Processing Research Institute survey is based on ADP's business payroll transaction system covering 411,000 companies and nearly 24 million employees. The data are processed by Moody's Analytics Inc., then calibrated and aligned with the BLS establishment survey data. The ADP data cover private sector employment only.

Small-sized business payrolls increased 37,000 (1.7% y/y) after an 18,000 gain. These increases were down from the high of 120,000 averaged in Q4'14. Hiring by medium-sized businesses rose 89,000 (1.6% y/y) compared to 40,000 in October, both less than the 112,000 averaged in Q1'14. Large-sized businesses posted a 90,000 increase in jobs (2.7% y/y), up from the 19,000 averaged in Q2'15.

Service-producing payrolls increased 228,000 (2.3% y/y) after a 138,000 rise. Jobs in trade, transportation & utilities increased 69,000 (1.7% y/y). Professional & business payrolls rose 68,000 (3.1% y/y). Education & health services employment gained 43,000 (2.6% y/y), while the leisure & hospitality sector increased hiring by 38,000 (2.5% y/y). Financial sector payrolls added 12,000 (2.1% y/y).

Goods-producing jobs declined 11,000 (-0.2% y/y) after a 20,000 increase. Employment in the construction industry inched 2,000 higher (+1.3% y/y) following a 16,000 decline. Hiring in the factory sector fell 10,000 (-0.3% y/y) after a 1,000 slip.

The ADP National Employment Report data are maintained in Haver's USECON database; historical figures date back to April 2001 for the total and industry breakdown, and back to January 2005 for the business size breakout. The expectation figure is available in Haver's AS1REPNA database.

A View from the Fed by Fed Governor Jerome H. Powell is available here.

ADP/Moody's National Employment Report Nov Oct Sep Nov Y/Y 2015 2014 2013
Nonfarm Private Payroll Employment (m/m chg, 000s) 216 119 196 1.9% 2.3% 2.2% 1.9%
 Small Payroll (1-49) 37 18 51 1.7 2.6 2.1 1.9
 Medium Payroll (50-499) 89 40 75 1.6 2.3 2.8 2.2
 Large Payroll (>500) 90 60 71 2.7 1.7 1.6 1.5
Goods-Producing -11 -20 32 -0.2 1.8 2.4 1.8
  Construction 2 -16 30 1.3 4.5 4.7 3.7
  Manufacturing -10 -1 4 -0.3 1.1 1.3 0.8
Service-Producing 228 138 164 2.3 2.4 2.2 1.9
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