U.S. businesses added new workers at a slower-than-expected pace
in May, according to a survey of hiring released Wednesday.
Private-sector payrolls in the U.S. increased by 179,000 new
jobs in May, says the national employment report compiled by
payroll processor Automatic Data Processing Inc. (ADP) and
forecasting firm Moody's Analytics.
Economists surveyed by the Wall Street Journal expected ADP to
report a stronger May advance of 210,000. The April ADP employment
increase was revised to 215,000 from 220,000 reported a month
ago.
"Job growth moderated in May. The slowing in growth was
concentrated in professional/business services and companies with
50-999 employees," said Mark Zandi, chief economist at Moody's
Analytics, which compiles the data. "The job market has yet to
break out from the pace of growth that has prevailed over the last
three years."
The ADP report, while less than expected, probably will not
change the perception of a spring revival in the U.S. economy after
an unexpected contraction during the harsh winter months.
The ADP estimate is issued ahead of the Bureau of Labor
Statistics' employment situation report scheduled for Friday.
Economists expect nonfarm payrolls will increase 210,000 in May.
That's slower than the surprisingly strong 288,000 added in April,
but still a solid job gain.
The May unemployment rate is expected to edge up to 6.4% after
it unexpectedly dropped to 6.3% in April from 6.7% in March.
Wednesday's ADP number probably will not cause many forecasters
to change their nonfarm payroll estimates.
According to ADP, firms employing between 1-49 workers hired
82,000 new workers this month. Medium-sized businesses with
payrolls of 50-499 workers increased payrolls by 61,000
employees. Large firms, businesses with 500 or more employees,
hired 37,000 more workers.
Service-sector payrolls increased by 150,000 workers last month.
The factory sector added 10,000 positions. Construction payrolls
increased by 14,000 slots.
ADP, of Roseland, N.J., offers payroll processing, human
resource and benefit adminstration services to about 620,000
clients worldwide. Economics firm Moody's Analytics is a subsidiary
of Moody's Corporation.
Write to Kathleen Madigan at kathleen.madigan@wsj.com
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