Labor Pains: Payroll Estimate Slumps to Lowest Level in 18 Months

US private-sector hiring hits 18-month low in March: ADP
© GETTY/AFP Drew Angerer

The U.S. labor market may be set to post another disappointing month.

U.S. private employers added 129,000 jobs in March, according to a report from ADP and Moody’s Analytics. That is the lowest level since September 2017 and below economists estimates of 165,000.

Last month the government said in a different report that non-farm payrolls grew by just 20,000 jobs, far below estimates. This was not predicted by the ADP private payrolls numbers, which saw payrolls growing by 183,000. In fact, ADP revised up its February estimate to 197,000.

That raises the possibility of a large revision to February’s numbers when the government releases the March non-farm payroll data on Friday.

“The job market is weakening, with employment gains slowing significantly across most industries and company sizes,” Moody’s Analytics chief economist Mark Zandi said in a statement. “If employment growth weakens much further, unemployment will begin to rise.

It was a tough month for manufacturing and construction, according to the ADP report. Manufacturers shed 2,000 jobs and the construction sector lost 6,000. Mining and natural resource extraction added 2,000.

The services sector added 135,000 jobs. As has often been the case in recent months, education and health services led the way, adding 56,000 jobs. Business services grew by 13,000. Leisure and hospitality added 13,000. Technology jobs added 11,000.

The ADP report is often looked at for indications of what the government’s more comprehensive monthly employment situation report will say about non-farm payrolls. But the two often paint very different pictures, as they did in February.

Economists were expecting non-farm payrolls to expand by 170,000 jobs in March. Those estimates could come down following the ADP report.


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