The numbers: Private payrolls rose by 247,000 in April, according to the ADP National Employment Report released Wednesday.
Economists polled by The Wall Street Journal had forecast a gain of 390,000 private sector jobs. This is the slowest gain since the pandemic-induced recession.
The ADP report is produced with Moody’s Analytics. In March, private payrolls were up 479,000.
Key details: By company size, small businesses saw job losses in April, losing 120,000 jobs. Large businesses added 321,000 private-sector jobs in April while Medium-sized businesses, defined as firms with 50 to 499 employees, added 46,000 jobs.
Service sector providers added 202,000 jobs in April. Leisure and hospitality added 77,000 workers. Meanwhile, goods producers added 46,000 jobs. Manufacturing added 25,000 jobs.
Big picture: The ADP data doesn’t always align month-to-month with the U.S. Labor Department’s report on employment to be released on Friday, but the data is still viewed with interest given the fact that the monthly government job figures are one of the best gauges for the health of the U.S. economy.
Economists expect the Labor Department report will show the economy added a net 400,000 jobs in April, including both private and government jobs, according to a Wall Street Journal poll. Economists expect the unemployment rate to tick down to 3.5% from 3.6%.
What ADP is saying: “In April, the labor market recovery showed signs of slowing as the economy approaches full employment,” said Nela Richardson, chief economist, ADP. Labor supply shortages are causing fewer jobs to be filled she said.
What economists are saying: “While the report isn’t much use as a guide to the official payroll figures, it is broadly consistent with our assumption that employment growth will continue to slow gradually – we expect a 375,000 gain in non-farm payrolls,” said Andrew Hunter, senior U.S. economist at Capital Economics.