American firms hired the most new employees in four months partially allaying fears that the recent drop in global equities would create a drag on the U.S. job market.
Companies added 199,500 workers in September after a revised gain of 186,300 the previous month according to ADP Research, a private payroll and accounting company. Economists in the Bloomberg survey had a median prediction of 190,000.
Payrolls have averaged 195,400 this year, slightly less than the 205,200 since the beginning of 2011. The three month moving average, however has dropped sharplythis year from 274,600 in December to 184,900 this month.
The Federal Reserve has cited the improving labor markets as the prime rational for considering the first increase in the Fed Fuds rate in seven years.
The ADP figures are often used as a window into the government’s non-farm payroll numbers, the most cited labor markets statistic, which has averaged 212,000 monthly this year and 206,000 since the start of 2011.
The Labor Department’s September's job figures will be released on Friday at 8:30 am. The economy is predicted to have added 200,000 new positions, up from August's 173,000. Private payrolls are forecast to expand by 198,000 after August’s 140,000 gain.
New service jobs at 188,000 far out stripped goods manufacturing ones at 11,500, not surprisingly in a U.S. economy two-thirds dominated by the service sector. Manufacturing jobs fell by 14,600 following August 3,900 gain. It was the largest one month elimination of factory jobs since January 2010. Construction employment rose 34,700 following August’s 17,500 additions, trade and transportation companies’ added 39,000 workers, financial services 15,000 and professional and business services 29,000.
Annual payroll growth slipped to 2.21 percent from 2.24 in August, the lowest since April 2014.
Payroll expansion was centered in large firms. Small business with 49 or fewer personnel hired 37,000, medium sized companies with 50-499 employees added 56,000 and large business with 500 or more workers created more than half the jobs at 106,000.
Automatic Data Processing (ADP) serves about 500,000 U.S. business clients, of which 365,000 firms employing approximately 24 million people comprise the survey.
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