Things are looking pretty good right now for the US labor market.
The latest jobs report from Automatic Data Processing (ADP), a payroll processing firm, shows that US businesses added 200,000 jobs in March, matching economists' expectations. That’s a good sign that the labor market is remaining strong, despite outside turbulence in the financial sector and fears about a global economic slowdown, which has been fueled by the global drop in fuel prices and a manufacturing decrease in China.
ADP’s job report comes out before the official government jobs report, which will be released by the Labor Department on Friday. But ADP’s report looks optimistic. Broken out across business size, small and mid-sized businesses gained the most, adding 86,000 and 75,000 jobs, respectively.
The industries that gained the most workers were in the services and trades, which added 191,000 and 42,000 employees, respectively. These industry additions are consistent with overall sector growth. The Bureau of Labor Statistics has projected that the occupations with the most job growth are in these fields, including registered nurses and retail sales assistants.
While service and trade positions are making exponential hires, other industries are also experiencing modest gains. The construction industry made 17,000 new hires, a decline from 27,000 in February, illustrating that plunging home sales continue to be a factor there. Financial services added 14,000 new jobs, a slight increase over February’s gain of eight thousand.
ADP’s March report builds upon the labor-market growth seen in ADP reports for previous months. The economy added 214,000 new jobs in February, according to ADP. Methodology for ADP’s reports is based on a sample population of 411,000 companies and 23 million employees.
Analysts are projecting that the unemployment rate held steady in March at 4.9 percent. Despite gains in the labor market, the rest of the economy continues to grow at a sluggish pace, expanding at a 2.2 percent average annual rate since the Great Recession ended in 2009. Some analysts have speculated that this anemic pace may continue for a few years yet as the longer-term effects of the recession linger.
Consumer spending has also hit a lull in the first three months of the year, even taking in low fuel prices and modest wage growth into consideration. Early trade data from the Commerce Department for February shows that, when adjusted for inflation, consumer spending rose by a modest 0.2 percent. Many Americans have been choosing to save what they can of their additional wages rather than buying new things or eating out more often. The amount that Americans have saved rose by a collective 5 percent during the last six months of 2015, and that pattern is projected to continue this year.