“Make yourself a sheep and the wolves will eat you”
Benjamin Franklin

U.S. private companies miss payroll expectations in November

Related

U.S. private payrolls increased less than expected in November, likely hampered by business restrictions due to increases in COVID-19 infections, adding to signs of slowing economic activity as a turbulent year winds down.

Private payrolls increased by 307,000 jobs last month, the ADP National Employment Report showed on Wednesday. Data for October was revised up to show 404,000 jobs added instead of the initially reported 365,000. Economists polled by Reuters had forecast private payrolls would rise by 410,000 in November.

The ADP report is jointly developed with Moody’s Analytics. Though it has fallen short of the government’s private payrolls count since May because of methodology differences, it is still watched for clues on the labor market’s health.

The United States has been slammed with a fresh wave of COVID-19 infections, with 4.2 million new cases and more than 35,000 coronavirus-related deaths reported in November, according to a Reuters tally of official data.

The slowdown in private hiring last month followed in the wake of reports showing a moderation in consumer spending in October and cooling in manufacturing activity in November.

More than $3 trillion in government COVID-19 relief helped millions of unemployed Americans cover daily expenses and companies keep workers on payrolls, leading to record economic growth in the third quarter. The fiscal stimulus has expired.

A bipartisan group of lawmakers on Tuesday proposed a new $908 billion emergency relief package. Senate Majority Leader Mitch McConnell said he and fellow Republicans were vetting stimulus ideas they believed President Donald Trump would sign into law.

The ADP report was released ahead of the government’s closely watched, and comprehensive, monthly employment report on Friday. According to a Reuters survey of economists, private nonfarm payrolls likely increased by 587,000 jobs in November after rising 906,000 in October.

With government payrolls expected to have declined again last month as temporary workers hired for the Census left and state and local government struggle with weakened budgets, overall nonfarm payrolls are forecast increasing by 481,000 jobs after rising 638,000 in October.

That would the smallest gain since the jobs recovery started in May. It would leave employment about 9.609 million below its peak in February. Job growth has cooled from a record 4.781 million in June.

Authorities across the country have imposed new restrictions on businesses and other places where crowds congregate. While the measures are not as tough as in March when the coronavirus pandemic started in the United States, they have had a chilling effect on the labor market.

First-time applications for unemployment benefits have increased for two straight weeks. Data from Homebase, a payroll scheduling and tracking company, showed a decline in the number of employees working in November compared to October.

A survey from the Institute for Supply Management on Tuesday showed its measure of factory employment contracted in November after expanding in October for the first time since July 2019. Manufacturers cited high rates of absenteeism and difficulties in returning people to work and in hiring staff due to COVID-19.

The economy grew at a historic 33.1% annualized rate in the third quarter after shrinking at a 31.4% rate in the April-June period, the deepest since the government started keeping records in 1947. Growth estimates for the fourth quarter are mostly below a 5% rate. Exploding coronavirus infections and lack of additional stimulus have left some economists anticipating a contraction in the first quarter of 2021.

(Reporting By Lucia Mutikani; Editing by Chizu Nomiyama)

- Advertisement -
SourceReuters

Add your comment(s)

 

Latest

Join Wolf Daily Today!
Get the most important breaking news, straight to your inbox. Sign up for FREE and begin receiving our members only exclusive daily newsletter.
Give it a try, you can unsubscribe anytime.
close-link
Don't Be Censored, Get our Newsletter