Private Sector Adds 58,000 Jobs; Layoffs Slow
U.S. private employers likely added 58,000 jobs in September, in line with expectations, a report by a private employment service said on Wednesday.
ADP Employer Services, whose employment report was jointly developed with Macroeconomic Advisers LLC, said it revised down to 27,000 from 38,000 the number of jobs created in August.
The consensus estimate of 26 economists surveyed by Reuters was for the ADP report to show 58,000 new private sector jobs in September.
"This month's ADP National Employment Report was the third consecutive weak reading and confirms the recent deceleration of employment," said Joel Prakken, Chairman of acroeconomic Advisers.
Government bonds were little moved by the report, which is released each month, two days prior to the government's own job survey.
In September, employment in the construction sector fell by 20,000, the 12th decline in thirteen months, bringing the cumulative decline since August of 2006 to 157,000, the report showed.
The report also showed that employment in the financial sector dropped by 7,000 in September, the second consecutive monthly decline after nearly six years of uninterrupted growth.
These are the two sectors of the economy hit hardest by the turmoil in credit markets, stemming from subprime mortgage problems and the slump in the housing sector.
Layoffs Fall Nearly 10%
A separate survey by Challenger, Gray & Christmas showed planned U.S. lay-offs fell 9.7 percent to 71,739 in September. They were 28.5% lower than September 2006, when employers announced 100,315 job cuts, one of only two times last year when monthly job cuts exceeded 100,000.
Year to date, employers have announced 587,594 job cuts, 8.1% fewer than the 639,229 cuts announced in the same period a year ago.
Housing-related job cuts in the financial, construction and real estate sectors account for 97,509 or 16.6% of this year's job cuts. In contrast, these three sectors represented less than 2% of the January-through-September job-cut total in 2006.
"It appears that the automotive sector has stabilized for the time being, particularly since General Motors and the United Auto Workers reached a labor agreement. Meanwhile, financial firms cannot cut their payrolls fast enough, especially in the mortgage lending sector," said John A. Challenger, chief executive officer of Challenger, Gray & Christmas.
According to the latest Reuters poll of economists, the U.S. Labor Department on Friday is expected to show that 94,000 non-farm payroll jobs were created in September after shedding 4,000 jobs in August, the first contraction in four years.
Automatic Data Processing, based in Roseland, New Jersey, is the parent of ADP Employer Services and is a large payroll services company. Macroeconomic Advisers LLC is based in St. Louis, Missouri.