EDITOR'S NOTE: Don't Miss a Beat! Sign-up for the Kitco News Weekly Roundup– our newsletter highlighting our most popular features, articles and videos! Register Here

Updated: ADP Shows 189K Private Sector Jobs Created In March

By Kitco News
Wednesday April 1, 2015 8:15 AM

Editor's Note: The article was updated to include more information from the report. The article was updated a second time to include comments from CIBC and Capital Economics.

(Kitco News) - U.S. companies further slowed the pace of hiring in March, falling below 200,000 jobs, according to the latest employment data released by payrolls processor ADP Wednesday. 

Private-sector employers added 189,000 jobs last month, down from February's revised data of 214,00 jobs; the initial report showed gains of 212,000. According to consensus estimates, economists were expecting to see a modest rise amounting to about 225,000 jobs being created last month.

According to the report, this is the lowest job growth since January 2014.

Although the data was much weaker than expected, Andrew Grantham, senior economist at CIBC World Markets, said it was not surprising as production throughout the country has weakened. However, he added that the data is still positive for the labor market.

“While that’s below the 225K consensus and the lowest since January 2014, it nevertheless remains a solid rate of job creation. We had expected that job growth could moderate slightly, given the weakness in productivity in the past couple of quarters, and today’s results from the ADP survey are broadly in line with that thinking,” he said.

In reaction to the numbers, Paul Ashworth, chief U.S. economist at Capital Economics, dismissed the ADP report as too pessimistic.

“Based on the drop back in initial jobless claims, the strength of job openings and the upbeat employment indices in the various activity surveys, we still estimate that the official figures, due out this Friday, will show that non-farm payrolls increased by 240,000 last month,” he said.

Looking at the components of the report, small businesses created 108,000 jobs last month, midsized businesses created 62,000 jobs and large corporations created 19,000.

In a sector-by-sector breakdown, the good-producing sector, created 5,000 jobs, the construction industry created 17,000 jobs, manufacturing lost 1,000 jobs, service-providing sector created 184,000 jobs, trades, transportation and utilities created 25,000 jobs, the financial sector created 16,000 jobs and professional and business sector created 40,000 jobs.

Economists note that ADP data has not always been a strong predictor of the official government employment numbers, which will be released on Friday. However some market analysts said that this month might be slightly different. Markets will be closed for Good Friday and traders or investorss will not be able to react or digest the data until Sunday evening, when electronic trading starts.

In a recent interview with Kitco News, George Gero, vice president and precious-metals strategist for RBC Capital Markets Global Futures, said that he would be surprised to see higher volatility during wednesday session as markets react to the employment numbers.

Ahead of Friday’s official nonfarm payrolls, according to consensus forecasts, economists are expecting to see that the U.S. economy created 247,000 in March.

By Neils Christensen of Kitco News; nchristensen@kitco.com
Follow Neils Christensen @neils_C

 

 

Disclaimer: The views expressed in this article are those of the author and may not reflect those of Kitco Metals Inc. The author has made every effort to ensure accuracy of information provided; however, neither Kitco Metals Inc. nor the author can guarantee such accuracy. This article is strictly for informational purposes only. It is not a solicitation to make any exchange in precious metal products, commodities, securities or other financial instruments. Kitco Metals Inc. and the author of this article do not accept culpability for losses and/ or damages arising from the use of this publication.
kitco news

Precious Metal Charts

Click to see this Precious Metal chart
  1. 24h
  2. 30D
  3. 60D
  4. 6M
  5. 1Y
 

Interactive Chart