Private business added a disappointing 38,000 jobs from April to May, according to an industry report released today. The ADP National Employment Report, widely used as a predictor for the monthly Labor Department report due on Friday, indicates private sector hiring is slowing sharply.
“A deceleration in employment, while disappointing, is not entirely surprising,” said ADP in a press release announcing the May jobs report. The economy grew at an anemic 1.8 percent in the first quarter and 2.25 percent in the last 12 months, ADP said, adding, “This is below most economists’ estimate of the economy’s potential growth rate and normally would be associated with very weak growth of employment.”
Job growth fell far short of the estimated 175,000 predicted by a panel of economists surveyed by Bloomberg. Stock market futures and the dollar declined on the news.
In May, service sector employment increased by 48,000 in its 17 consecutive months of gains, while manufacturing jobs fell 9,000 following seven months of gains. The financial service sector dropped 6,000 jobs and the goods-producing sector lost 10,000 jobs. Large businesses pared 19,000 jobs, while medium-sized employers added 30,000 jobs. Employment for small businesses rose 27,000, but construction industry jobs dropped 8,000 in May, reversing April’s increase. Since its peak in 2007 the construction industry has lost more than 2.1 million jobs.