The Dec ADP employment report was a blowout to the upside as the private sector added 297k jobs vs the expectation of 100k and up from 92k in Nov. According to Macroeconomic Advisors, who compile the data, there may have been some seasonal issues with the calculation but believe the figure was strong nonetheless. Most of the job gains came from the small and medium sized businesses in the service sector. The service sector overall added 270k jobs with goods producing adding the balance of 27k. Manufacturing jobs rose by 23k while construction jobs were flat and the 1st time they haven’t fallen since June ’07. The financial services sector shed 8k jobs. Bottom line, the gains are clearly strong but we’ll see if Friday’s Government payroll figure confirms this as the two data points have rarely seen eye to eye month to month as ADP reported private sector job gains almost double the Government one in Nov. Either way, the labor market is clearly improving.
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