ADP reports that the private sector shed 473k jobs in June, below expectations of a drop of 394k but is in line with the revised decline of 485k in May (from 532k). Small and medium sized businesses continue to lose the most amount of workers relative to large companies in both goods producing and service providing sectors. Construction employment fell by 97k and June was the 29th month in row of declines and has fallen 1.428mm from the peak in Jan ’07. The financial services area cut 29k jobs, the 19th straight month of declines. Although the data is very helpful, the month to month relationship with the government payroll data has been sketchy as evidenced by the May data where ADP first reported a decline of 532k and two days later the government said payrolls fell by 345k. Thus, Friday still remains a crap shoot with current estimates at -363k with an unemployment rate of 9.6%.
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