ADP Sees Rebound In U.S. Employment
E-Mail | Print | Comments | Request Reprints | E-Mail Newsletters | RSS
Market Scan
ADP Sees Rebound In U.S. Employment
Andrew Farrell, 10.31.07, 8:58 PM ET
Job growth is on the rise just in time for the holiday season.
An analysis of October payroll data showed job growth picking up in the United States, suggesting that the Labor Department will announce better-than-expected nonfarm payroll growth later this week.
Nonfarm private employment grew by 106,000 positions during October, according to an analysis of payroll data from Automatic Data Processing (nyse: ADP - news - people ). The October growth represents a notable rebound. From July to September, nonfarm employment grew an average of 43,000 per month.
The growth was largely attributable to the services sector, where companies hired 134,000 more employees during October.
One area of weakness, unsurprisingly, was construction. Residential builders have cut back on hiring amid a weak housing market. Employment in the construction sector fell by 16,000. It was the 13th decline in the last 14 months.
Joel Prakken, Chairman of Macroeconomic Advisers, which performs the ADP analysis, said the sluggish housing market was also evident in a decline in employment in the financial serives sector. The sector includes mortgage companies which have cut back sharply on originations this year.
The housing problems, however, seem to be contained. "There isn't evidence yet that hiring in other sectors seems to be affected by the housing fallout," said Prakken.
The ADP data comes ahead of the Labor Department's October nonfarm payrolls data, which will be released Friday. Economists are expecting a growth of 80,000.
The ADP data and Labor Department data are not perfectly comparable. The Labor Department data will include government hiring, while the ADP is limited to private employment. Still, the strong ADP numbers suggest better-than-expected Labor Department numbers.
Also Wednesday, the Commerce Department estimated gross domestic product rose to an annual rate of 3.9% during the third quarter. Economists had been expecting only 3.1%. GDP measures the output of goods and services produced in the U.S. and is used as a gauge for overall economic activity.
The data comes ahead of the Federal Reserve's eagerly awaited decision on the federal funds interest rate. The Fed is widely expected to cut the rate by 25 basis points to 4.5%, in a statement to be released this afternoon.
The strong economic data pushed up equities. The Dow Jones industrial average gained 1.0%, or 137.54, to close at 13,930.01; the Standard & Poor's 500 rose 1.2%, or 18.36 points, to 1,549.38; and the Nasdaq composite put on 1.5%, or 42.41 points, to 2,859.12.
One of the bigger gainers was Sirius Satellite Radio (nasdaq: SIRI - news - people ), which gained 2.1%, or 7 cents, to $3.36, rebounding from a sell-off Tuesday that followed the company's third-quarter earnings release.
Find thousands of Bilingual jobs at LatPro.com.
Market Scan
ADP Sees Rebound In U.S. Employment
Andrew Farrell, 10.31.07, 8:58 PM ET
Job growth is on the rise just in time for the holiday season.
An analysis of October payroll data showed job growth picking up in the United States, suggesting that the Labor Department will announce better-than-expected nonfarm payroll growth later this week.
Nonfarm private employment grew by 106,000 positions during October, according to an analysis of payroll data from Automatic Data Processing (nyse: ADP - news - people ). The October growth represents a notable rebound. From July to September, nonfarm employment grew an average of 43,000 per month.
The growth was largely attributable to the services sector, where companies hired 134,000 more employees during October.
One area of weakness, unsurprisingly, was construction. Residential builders have cut back on hiring amid a weak housing market. Employment in the construction sector fell by 16,000. It was the 13th decline in the last 14 months.
Joel Prakken, Chairman of Macroeconomic Advisers, which performs the ADP analysis, said the sluggish housing market was also evident in a decline in employment in the financial serives sector. The sector includes mortgage companies which have cut back sharply on originations this year.
The housing problems, however, seem to be contained. "There isn't evidence yet that hiring in other sectors seems to be affected by the housing fallout," said Prakken.
The ADP data comes ahead of the Labor Department's October nonfarm payrolls data, which will be released Friday. Economists are expecting a growth of 80,000.
The ADP data and Labor Department data are not perfectly comparable. The Labor Department data will include government hiring, while the ADP is limited to private employment. Still, the strong ADP numbers suggest better-than-expected Labor Department numbers.
Also Wednesday, the Commerce Department estimated gross domestic product rose to an annual rate of 3.9% during the third quarter. Economists had been expecting only 3.1%. GDP measures the output of goods and services produced in the U.S. and is used as a gauge for overall economic activity.
The data comes ahead of the Federal Reserve's eagerly awaited decision on the federal funds interest rate. The Fed is widely expected to cut the rate by 25 basis points to 4.5%, in a statement to be released this afternoon.
The strong economic data pushed up equities. The Dow Jones industrial average gained 1.0%, or 137.54, to close at 13,930.01; the Standard & Poor's 500 rose 1.2%, or 18.36 points, to 1,549.38; and the Nasdaq composite put on 1.5%, or 42.41 points, to 2,859.12.
One of the bigger gainers was Sirius Satellite Radio (nasdaq: SIRI - news - people ), which gained 2.1%, or 7 cents, to $3.36, rebounding from a sell-off Tuesday that followed the company's third-quarter earnings release.
Find thousands of Bilingual jobs at LatPro.com.
Labels: ADP Report, employment
<< Home