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Economy in Brief

U.S. ADP Private Payroll Growth Remains Solid
by Tom Moeller  March 7, 2018

The ADP/Moody's National Employment Report indicated that private nonfarm payrolls increased 235,000 during February following a 244,000 January gain, revised from 234,000. A 200,000 rise had been expected in the Action Economics Forecast Survey. Payrolls have risen an average 182,000 during the last twelve months. 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 hiring increased 68,000 (1.2% y/y) in February, up from average 51,000 growth during the last twelve months. Medium-sized payrolls gained 97,000 (2.0% y/y) versus the 74,000 twelve-month average. Large-sized payrolls strengthened 70,000 (2.4% y/y), up from the 57,000 twelve-month average.

Private service-sector payrolls improved 198,000 (1.7% y/y), up from the 151,000 twelve-month average. The number of trade, transportation and utilities jobs rose a strengthened 44,000 (1.0% y/y) after a 47,000 increase. Education & health services employment rose a strong 43,000 (2.1% y/y). Employment in the leisure & hospitality sector gained 50,000 (2.2% y/y), the strongest rise in four months. Professional & business services payrolls improved 46,000 (2.6% y/y), on a par with the last twelve-month average. Financial activities jobs rose 9,000 (1.4% y/y), about as they have during the last four months. Employment in the information sector eased 1,000 (-0.7% y/y) where payrolls have been falling since early 2016.

Employment in the goods-producing sector rose a fairly steady 37,000 (1.9% y/y). Construction sector payrolls increased 21,000 (2.5% y/y) after a 14,000 average twelve-month rise. Jobs in the factory sector rose a steady 14,000 (1.3% y/y). In the natural resource & mining sector, jobs rose a strengthened 2,000 (5.5% y/y).

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.

Navigating Monetary Policy as Headwinds Shift to Tailwinds from Fed Governor Lael Brainard can be found here.

ADP/Moody's National Employment Report Feb Jan Dec Feb Y/Y 2017 2016 2015
Nonfarm Private Payroll Employment (m/m chg, 000s) 235 244 249 1.8% 1.8% 1.9% 2.3%
 Small Payroll (1-49) 68 63 99 1.2 1.3 1.9 1.9
 Medium Payroll (50-499) 97 95 98 2.0 1.9 1.5 2.3
 Large Payroll (>500) 70 86 53 2.4 2.3 2.7 3.0
Goods-Producing 37 39 52 1.9 1.5 0.8 2.0
  Construction 21 22 35 2.5 3.1 4.3 5.3
  Manufacturing 14 14 16 1.3 0.7 0.2 1.2
Service-Producing 198 205 198 1.7 1.8 2.2 2.3
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