Payroll services firm ADP reported yesterday that the U.S. private sector added 241,000 new jobs in December, continuing a recent stretch of significant gains in the labor market. The figure, which came in above the consensus forecast of 225,000 positions, was boosted by an especially strong showing by the services sector. ADP also revised upward its November payrolls by 19,000 jobs.
“The job market continues to power forward,” said Mark Zandi, chief economist at Moody’s Analytics, which prepared the report along with ADP. “Businesses across all industries and sizes are adding to payrolls. At the current pace of job growth, the economy will be back to full employment by this time next year.”
Data showed small businesses (fewer than 50 employees) contributed the most to December’s increase, adding 106,000 new jobs. Medium-sized firms (50-499 employees) expanded payrolls by 70,000 and large companies (500 or more employees) hired 66,000 people last month. Businesses in the services industry added 194,000 jobs, while manufacturers hired 26,000 people and financial firms brought on 16,000 new workers.
ADP’s release is a closely-watched precursor to the official Bureau of Labor Statistics report, which will be made public tomorrow. Most economists expect the December government jobs data will reduce the U.S. unemployment rate to 5.7%, further pressuring the Federal Reserve to raise interest rates before the summer.