WASHINGTON: US private employment continued to grow in November albeit at a slower-than-anticipated rate, according to private data released on Wednesday, raising fears the US economy's momentum was slowing amid the renewed Covid-19 wave.
Payroll services firm ADP said private jobs rose 307,000 last month, seasonally adjusted, with firms of all sizes showing increases, though that gain was slower than October's upwardly revised gain of 404,000.
The US economy has been recovering from mass layoffs earlier this year caused by the Covid-19 pandemic, but those gains were fuelled in part by easing of business restrictions as well as massive spending by Congress.
Many of those federal programmes have lapsed while virus cases are surging across the United States to levels not seen since the start of the outbreak. That has raised fears that the government's key November employment report to be released on Friday will show a retreat in hiring.
The ADP report is seen as an imperfect preview of the official data, and Ian Shepherdson of Pantheon Macroeconomics said it was a relief the report wasn't worse. "We expected a much weaker number," he said.
The ADP data showed service sector jobs led the November increase with 276,000 positions added, particularly in leisure and hospitality, the sector that has borne the brunt of the layoffs. However, that increase was the slowest since June.
Small businesses with 1 to 19 employees added 60,000 jobs, accounting for the bulk of the rise in leisure and hospitality payrolls.
The goods-producing sector added only 30,000 jobs, the majority of which was in construction.
The biggest job gains came in midsized businesses of between 50 and 499 employees, followed by small businesses coming in second.
Construction employment increased by 22,000 jobs and manufacturers hired 8,000 workers. There were employment gains in financial activities, professional services, education and healthcare sectors. The information industry added no jobs.
"The rapid spread of the virus across the nation is making it harder to find employment this fall and this puts the entire economic recovery from recession in jeopardy if Congress can't get it together and vote on a new stimulus package before the end of the year," said Chris Rupkey, chief economist at MUFG in New York.
The ADP report is jointly developed with Moody's Analytics. Though it has fallen short of the government's private payrolls count since May because of methodology differences, it is still watched for clues on the labour market's health.
"The broad message from the ADP report is consistent with what we expect the government data to show, the labor market continued to add jobs on net in November but the pace of job growth slowed," said Daniel Silver, an economist at JPMorgan in New York. – AFP, Reuters
