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ADP: Private Sector Employment Rose by 118,000 in November

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The private sector created 118,000 jobs in November, primarily thanks to service-related jobs, a number that missed expectations ahead of Friday's closely watched government report.

Economists had expected the report to show 125,000 total private jobs created as the effects linger from Superstorm Sandy and anxiety over the "fiscal cliff" negotiations in Washington.

ADP said the service sector created 114,000 new positions, while goods-producing businesses accounted for the balance of 4,000 jobs. Gains of 23,000 construction jobs offset a loss of 16,000 in manufacturing.

The report is often used as a precursor to the monthly nonfarms payroll report, which the government will release Friday. The economy is expected to have created 93,000 new jobs in November, with the unemployment rate likely to hold steady at 7.9 percent.

While the report can change economists' views, the ADP and government numbers often show wide differences.

As a result, ADP partnered last month with Moody's Analytics in an effort to provide a more accurate number.


For October, ADP reported 157,000 new jobs - revised lower by 1,000 - while the government showed a total of 184,000 new payroll positions.

The bulk of the November job creation also came from large businesses, with 66,000 new positions, while medium-sized firms with 50 to 499 employees created 33,000 and small businesses added 19,000.

In other surveys employers have expressed reluctance to hire until Washington straightens out the fiscal cliff dangers. Unless Congress and President Barack Obama reach an agreement by the end of the year, $600 billion worth of spending cuts and tax increases will take effect automatically, likely plunging the nation into recession.

Sandy also played havoc with the economy after the late-October storm cut power for weeks to parts of the Northeast and caused perhaps $50 billion in damage.

"Abstracting from the storm, the job market turned in a good performance during the month," Moody's economist Mark Zandi said in a statement. "This is especially impressive given the uncertainty created by the presidential election and the fast-approaching fiscal cliff. Businesses appear to be holding firm on their hiring and firing decisions."

-- An earlier version of this story had an incorrect time stamp.

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