- Private sector job creation zoomed to 202,000 in December far ahead of 160,000 forecast.
- Report leads into Friday’s NFP report which is predicted to add 164,000 positions.
- November’s total revised to 124,000 from 67,000.
The US labor market finished the year in excellent fashion as private payroll growth rose above the annual trend with the service and manufacturing sectors both contributing to the gains.
Firms using Automatic Data Processing’s (ADP) payroll services added 202,000 workers in December as the US labor market continued to excel in the 11th year of expansion. It was the largest increase since April. Goods producing industries added 29,000 employees after shedding 17,000 in November and services providing businesses hired the 173,000 balance.
The dollar saw modest gains after the release with the EUR/USD falling from 1.1150 just before the 8:15 EST release to 1.1115 by 11:00 EST. USD/JPY gained about 20 points to 108.65.
Jobs were spread across all three categories of companies with small firms (1-49 employees) adding 69,000 workers, mid-size firms (50-499 employees) 88,000 and large companies (500+ employees) 45,000.
Construction trades grew by 37,000, its best score since April and reversing November’s 5,600 decline. Trade, transportation and utilities added 78,000 and professional and business services 61,000. Education and health services rose by 49,000 and financial services 10,000.
Firms losing workers were in leisure and hospitality at 21,000 and information services at 14,000.
The ADP report is tabulated from its approximately 411,000 US clients. It is released on the Wednesday before the Bureau of Labor Statistics (BLS) Employment Situation Report which is usually issued on the first Friday of every month.
Correlation between the two statistics can diverge substantially on a monthly basis. In November the unexpectedly weak initial ADP figure of 67,000 contrasted with the equally unanticipated strength of 266,000 in the NFP. However, over time over time the trends in the two statistics are complementary.
The 12-month moving average for non-farm payrolls dropped 22% from January 2019 to November, 235,000 to 184,000. The ADP average fell 26% in the same period from 222,000 in April to 165,000.
Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers.