Business

Private job growth hit 807,000 in December, more than double expectations


Companies hired at the fastest rate in seven months in December amid escalating fears of an increase Covid , according to a report Wednesday from payroll processing company ADP.

Private job growth totaled 807,000 for the month, beating the Dow Jones estimate of 375,000 and the November gain of 505,000. The revised November total is lower than initial report was 534,000.

The total is the best for the job market since 882,000 in May 2021, according to ADP data.

Hiring was broad-based, although leisure and hospitality led the way with 246,000 new positions. Trade, transport and utilities contributed 138,000, professional and business services increased by 130,000, education and health services increased by 85,000.

While service-related occupations led the way with 669,000 new hires, goods manufacturing also saw a strong increase. Manufacturing increased by 74,000 and construction contributed 62,000 to the total.

Work obtained in the same month Covid cases skyrocketed raised new concerns about an economic downturn. Earlier this week, the US reported 1 million new positive cases in just one day as the omicron variant was already rampant in the population.

However, the ADP report, compiled with Moody’s Analytics, covers through mid-December, before the worst of the escalation.

“December’s job market strengthened as the fallout from the Delta variant faded and the impact of Omicron was yet to be seen,” said Nela Richardson, chief economist at ADP. “Employment gains were broadly based, as commodity manufacturers added their strongest reading of the year, while service providers dominated growth.”

The announcement comes two days before a more closely watched nonfarm payrolls report from the Department of Labor’s Bureau of Labor Statistics is expected to show growth of 422,000, according to estimates by the Labor Department. Dow Jones agrees.

The two figures can differ significantly: In the 12 months before December, ADP’s tally averaged about 441,000 a month, while the average BLS was 483,500.

Businesses with 500 or more employees accounted for most of the increase in December, adding 389,000 jobs. Medium-sized companies added 214,000, while companies with fewer than 50 workers contributed 204,000.

Rapid hiring speed reflects weekly unemployment trend, is running around its lowest level in more than 50 years.

However, total employment remains far below pre-pandemic levels. Even if the unemployment rate falls from the pandemic’s peak of 14.8% to the current 4.2%, there are still about 3.6 million Americans working less than in February 2020 and the The workforce is nearly 2.4 million smaller as the labor force participation rate is down by 1.5 percentage points, according to BLS data through November.

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