Private Businesses Create 281K Jobs in June, says ADP

By Dow Jones Business News, 
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By Kathleen Madigan

U.S. businesses went on a hiring spree in June, according to a survey of hiring released Wednesday. The higher-than- expected gain could raise expectations for the government's payrolls report due on Thursday.

Private-sector payrolls in the U.S. increased by 281,000 new jobs in June, according to 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 June advance of just 210,000. The May ADP employment increase was unrevised at 179,000.

The ADP estimate is issued ahead of the Bureau of Labor Statistics' employment situation report scheduled for Thursday.

Economists expect nonfarm payrolls to increase 215,000 in June, close to the 217,000 added in May.

The June unemployment rate is expected to hold at 6.3%.

Wednesday's ADP number adds an upside risk to the June nonfarm payrolls estimates. Forecasters look at ADP as a guide for payrolls, but the private-sector report has a history of large misses when it comes to anticipating the BLS's number.

According to ADP, firms employing between 1-49 workers added 117,000 new workers last month. Medium-sized businesses with payrolls of 50-499 workers increased payrolls by 115,000 employees. Large firms, businesses with 500 or more employees, hired 49,000 more workers.

Service-sector payrolls increased by 230,000 workers last month. The factory sector added 12,000 positions. Construction payrolls increased by 36,000 slots.

Another report that focuses on small firms did not meet expectations for June. The Intuit small business index shows small firms employing fewer than 20 employees increased payrolls by 20,000 jobs last month, a little slower than 25,000 estimated to have been added in May.

ADP, of Roseland, N.J., offers payroll processing, human resource and benefit administration 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

Corrections & Amplifications

This item was corrected at 12:26 p.m. ET because it omitted the word "jobs" from the headline.


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This article appears in: US Markets , Economy

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