Private-sector job growth slows to still-solid 158,000

Abby McDonough, Hanna Waring
Hannah Waring, left, and Abby McDonough work in a strawberry stand May 23 at Wegmeyer Farms in Hamilton, Va.
(Carolyn Kaster / Associated Press)

Job growth by U.S. businesses slowed to 158,000 in June, below analyst expectations but still a solid gain as labor market growth eases, payroll firm Automatic Data Processing said Thursday.

Last month’s figure was down from 230,000 net new jobs in May. Analysts had expected the data, a closely watched harbinger for the Labor Department’s official report due out Friday, to show the private-sector added 180,000 jobs last month.

But Mark Zandi, chief economist of Moody’s Analytics, said the job growth shows that the labor market “continues to power forward” at a consistent pace of between 150,000 and 200,000 net new jobs a month

“At this pace, which is double the rate of labor force growth, the tight labor market will continue getting tighter,” said Zandi, whose firm helps ADP in preparing its monthly report.


ADP’s figures have been off in recent months compared to the official statistics from the Labor Department.

In May, for example, the Labor Department said businesses added 147,000 net new jobs, well below ADP’s figure.

In April, ADP undershot the Labor Department’s estimate of private-sector jobs by 25,000.

And in March, ADP said private-sector job growth was 255,000 while the Labor Department said it was only 59,000.


ADP’s report is based on an analysis of its payroll data. The Labor Department uses its own survey of U.S. employers — both private and public sector.

Analysts expect the Labor Department to report on Friday that the economy added 170,000 net new jobs last month. That would be up from the 138,000 private and public sector positions added in May.

The unemployment rate is forecast to have held steady at 4.3%, the lowest since 2001.

President Trump tweeted this week that the media were ignoring the economy’s “great jobs numbers” since he took office. But labor market growth has been slowing as the recovery from the Great Recession reached eight years last month.

So far, 2017 is on pace to produce the fewest net new jobs in seven years.

But that doesn’t mean the labor market is in trouble.

The number of people filing for first-time unemployment benefits last week was 248,000, the Labor Department said Thursday. Although the figure was up 4,000 from the previous week, it remained near historic lows.


ASP said June’s job gains were strongest in professional and business services, education and health services. But natural resources and mining companies reduced their payrolls by 4,000, while construction firms shed 2,000 net new jobs.

Twitter: @JimPuzzanghera

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