U.S. companies grew their payrolls by 185,000 workers in July, according to closely-watched data from firm ADP. The job gains, while consistent with recent numbers, fell short of consensus forecasts from economists, who expected the private sector to add about 215,000 jobs last month.
“Job growth is strong, but it has moderated since the beginning of the year,” said Mark Zandi, chief economist at Moody’s Analytics, which produces the report along with ADP. “Layoffs in the energy industry and weaker job gains in manufacturing are behind the slowdown. Nonetheless, even at this slower pace of growth, the labor market is fast approaching full employment.”
Payroll data showed service-type employment rose by 178,000 jobs in July, down from 216,000 in June. Within specific sectors, the professional/business services segment contributed 42,000 July jobs, while the trade/transportation/utilities and financial markets added 25,000 and 10,000 positions respectively. Job creation in the manufacturing and construction sectors slowed. Small businesses (fewer than 50 workers) added 59,000 jobs last month, mid-sized firms (50-499 employees) grew ranks by 62,000 positions, and large companies (500 or more) increased payrolls by 64,000 people.
“July employment growth was slower than June, but is still in line with what we have seen since the first of the year,” said Carlos Rodriguez, president of ADP. “Notably, large businesses with more than 500 employees had their strongest job gains since last December and were almost double the June number.”
The official government jobs report will be released tomorrow morning by the Bureau of Labor Statistics. Most analysts are predicting total growth of at least 200,000 jobs in July, leaving the U.S. unemployment rate at 5.3%.