Remember how last month’s jobs figures created bipartisan handwringing because they failed to meet expectations and the sky was falling? Well:
Private job growth for May accelerated at its fastest pace in nearly a year as companies hired 970,000 workers, according to a report Thursday from payroll processing firm ADP.
It was a big jump from April’s 654,000 and the largest gain since the 4.35 million added in June 2020 as the national economy came out of its Covid-19 lockdown. Economists surveyed by Dow Jones had been looking for 680,000 in May.
The April total was revised sharply lower from the initially reported 742,000.
ADP’s private payroll count, done in conjunction with Moody’s Analytics, serves as a precursor to Friday’s more closely watched nonfarm payrolls data from the Labor Department. However, the two numbers can differ substantially, as they did in April when the official count showed just 266,000 new jobs compared with expectations of a million.
“Private payrolls showed a marked improvement from recent months and the strongest gain since the early days of the recovery,” said Nela Richardson, chief economist at ADP.
The ADP figures showed a boom in leisure and hospitality jobs. In a continuing recovery for the industry hurt most by the government-induced lockdowns, the sector added 440,000 new jobs for the month.
Education and health services added 139,000, though most came from health care, while trade, transportation and utilities contributed 118,000. Professional and business services saw 68,000 new hires while the other services category had 69,000.
On the goods-producing side, construction payrolls increased by 65,000 while manufacturing added 52,000.
Overall, services were responsible for 850,000 jobs and goods-producing made up the balance of 128,000.
Job gains were distributed almost perfectly even by company size, with medium-sized businesses of 50-499 employees contributing 338,000. Small firms hired 338,000 and large companies had 308,000.
“Companies of all sizes experienced an uptick in job growth, reflecting the improving nature of the pandemic and economy,” Richardson said.
The official nonfarm payrolls count for May is expected to show growth of 671,000 a drop in the unemployment rate to 5.9%.
This was predictable, of course.m The country is re-opening and as they become vaccinated the public is desperate to get out of the house and start living their lives again. And May was when the bulk of the population became fully protected from the virus.
Now, get ready to hear from the same people who were freaking out over last months report to quickly switch gears and say the economy is overheating and the government has to stop spending immediately. They’ve always got something.