Businesses Drastically Reduced New Hires In July According To Private Payroll Processor
Private sector job creation for displaced workers slowed in July, with private payroll increases not meeting the growth expected by economists, CNBC reported.
Economists who were surveyed by Dow Jones expected private-sector employment to increase by 1 million, yet reported an increase of 167,000, CNBC reported. The report was issued by Dow Jones economists and Moody’s Analytics.
The total private-sector increase in June was initially estimated at 2.4 million jobs, with an actual increase of 4.314 million jobs, CNBC reported. In the months of May and June, a combined total of 6.714 million private-sector jobs were created, making a dent in the 19.7 million jobs lost to the economic shutdown caused by the coronavirus.
Automatic Data Processing, Inc. (ADP), the source of this data, is a human resources company that provides “cloud-based human capital management solutions,” according to their website. Reported jobs numbers could be revised due to the coronavirus pandemic and ADP’s tally may differ from the official government count, CNBC reported. (RELATED: REPORT: Americans Have Lost Nearly $100 Million To Coronavirus Scams)
“It is worth reiterating that the ADP has never been a great guide to the official payrolls figures and has actually been particularly poor in recent months, with the ADP’s initially published estimates for May and June (which have since been miraculously revised up to better match the official data) proving far too pessimistic,” Senior U.S. Economist at Capital Economics, Andrew Hunter said, CNBC reported.
Private payrolls grow by 167,000 in July, well below expectations https://t.co/GN8KxfvAC7
— Jeff Cox (@JeffCoxCNBCcom) August 5, 2020
Transportation, trade, and utility jobs reported an employment increase of 41,000, and manufacturing reported an additional 10,000, the ADP reported. However, jobs in construction, mining, and natural resources reported a combined loss of 9,000 jobs.
Health services and education reported again of 46,000 employees, while information services and financial activities lost a combined total of 21,000, according to the ADP. The hospitality and leisure sector reported an increase of 38,000 jobs.
Professional and business services reported the highest increase of jobs at 58,000, with all but 1,000 of the jobs coming from the service sector, CNBC reported.
Businesses with fewer than 50 employees reported an increase of 63,000, while businesses with between 50 and 499 workers reported a decrease of 25,000, the ADP reported. Businesses with 500 or more employees reported an increase of 129,000 while franchises reported an increase of 21,000, the ADP reported.
“The labor market recovery slowed in the month of July,” ADP Research Institute Vice President Ahu Yildirmaz said. “We have seen the slowdown impact businesses across all sizes and sectors.”
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