By IB Times Staff Reporter: Subscribe to IB's RSS feed
September 1, 2010 12:43 PM EDT
ADP released their non-farm private payrolls, showing that the US private-sector employment fell 10,000 in August, compared with a revised gain of 37,000 in July. The consensus economist forecast was a 13,000 gain.
This is the first loss following six months of consecutive gains. The estimated change of employment from June to July was revised down slightly, from the previously reported increase of 42,000 to an increase of 37,000.
"The decline in private employment in August confirms a pause in the recovery already evident in other economic data," the report said.
Employment fell in the goods-producing sector of 40,000, while employment in the manufacturing sector decreased 6,000. But, the report estimates non-farm private employment in the service-providing sector rose by 30,000, the seventh consecutive monthly gain.
The non-farm payrolls measures the change in the number of employed people during the last month of all non-farming businesses. The total non-farm payroll accounts for about 80 percent of the workers who produce the entire gross domestic product of the United States.
Like us on Facebook
On Thursday, the volatile weekly initial jobless claims report will be released. Economists are looking for 475,000, versus 473,000 in the previous week.
On Friday, the Bureau of Labor Statistics (BLS) will release their closely-watched employment report, which contains the unemployment rate and non-farm payrolls gain. Unlike the ADP report, the BLS report includes the hiring and firing of government workers, including those who worked for the 2010 Census. Hiring for the census peaked in May.
For this reason, Friday’s figure for the change in non-farm total employment reported by the BLS might be weaker than today’s estimate for non-farm private employment.
Economists are looking for unemployment rate of 9.6 percent, overall payrolls decline of 118,000.
Paul Ashworth, senior US economist at Capital Economics, believes the the decline in the ADP survey is only going to heighten fears about a double-dip recession.
“Admittedly, the 10,000 decline is pretty marginal,” he said.
“Nevertheless, the optics of a decline will be hard for the markets to ignore. The deterioration in employment was widespread, with goods producing industries reducing headcounts and service industries taking on much fewer additional workers.”
Ashworth noted that doesn't anticipate an outright contraction in activity, but economic growth will remain lackluster for some time.
“Furthermore, if employment is shrinking, even marginally, we will start to see the unemployment rate edging higher over the next few months,” he cautioned.
“With fiscal policy paralyzed ahead of the mid-term elections, and probably beyond as well, the pressure will all be on the Fed.”
Diet Soda: Research Sparks Debate on Risks of Heart Disease, StrokePut down your diet soda and listen up. The bubbly zero calorie drink may increase your risk of heart disease, according to new research.
First Photos of Beyonce’s Baby Blue Ivy Carter Reignite Surrogacy Rumors [PHOTOS]The first photos of Beyonce's baby Blue Ivy Carter were released to the world on Friday by Beyonce and husband Jay-Z. The couple posted five photos one the Tumblr page "Hello Blue Ivy Carter.
Greece in Turmoil as EU Austerity Package Put on HoldGreece’s financial future in doubt after ministers look again at strict terms of European rescue package.
We value your privacy. Your email address will not be shared.
