ADP: Hiring Up Modestly In May
Some Analysts Disappointed With Results
According to payroll processing firm ADP, private-sector job growth picked up slightly in May as employers added 135,000 positions. The May figure was up from 113,000 the previous month. The Labor Department reported the economy added 165,000 net new jobs in April and the unemployment rate ticked down to 7.5%. Most economists expect similar job growth in May, with about 167,000 net new jobs added.
However, the ADP survey results disappointed some analysts who see the economy struggling through tax increases and federal spending cuts. "Instead of accelerating, which of course is what everyone would like to see, we are decelerating in job growth going into the spring and summer," said Mark Zandi, chief economist at Moody's Analytics, which assists ADP with the monthly report.
Despite the weaker projection, ad specialty industry firms are looking ahead with optimism. Dave Helfrich, owner of My Brand Promo, Inc. (asi/257837), started his company in 2009 with his business partner and one employee. He now has four full-time employees and four more sales associates. "We doubled the size of our offices," said Helfrich. "If our business keeps at the current pace, we'll need to add more of both by year's end."
Small businesses, like Helfrich's, showed the largest job gains in May, according to ADP. Nearly 60,000 positions were added by smaller companies last month. Medium-sized businesses and large businesses each added 39,000, ADP data showed. Professional and business services led job gains, with 42,000, while conversely, manufacturers lost 6,000 jobs.
The U.S. Bureau of Labor Statistics will release official jobs numbers tomorrow.