Private US companies hired at a slightly slower pace in April, with new employment nearly entirely in the services sector, payroll firm ADP reported Wednesday.
Nonfarm private employment rose 177,000, below the 255,000 increase in March, and the lowest increase since October, although the result was slightly better than the consensus forecast.
The report, which covers 411,000 firms and 24 million workers, comes before Friday’s closely-watched US employment data, although the two reports can diverge widely.
In March, the Labor Department reported an increase of just 98,000 nonfarm payrolls, far below the ADP figure. Analysts are expecting Friday’s report to show a gain of 180,000 for April.
Mark Zandi, chief economist of Moody´s Analytics, said job growth slowed in April due to a pullback in construction and retail jobs, which continue their retreat.
“The softness in construction is continued payback from outsized growth during the mild winter,” he said in a statement. “Brick-and-mortar retailers cut jobs in response to withering competition from online merchants.”
Of the total, 165,000 new jobs were in services, while construction saw a decline of 2,000, and manufacturing jobs increased by 11,000.
Ahu Yildirmaz, vice president of the ADP Research Institute, said despite the slower pace of hiring in the first quarter, “the growth is more than strong enough to accommodate the growing population as the labor market nears full employment.”
Broken down by company size, medium sized businesses hired 78,000 new employees last month, and have “showed persistent growth for the past six months,” he said.
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