America’s private sector added 455,000 jobs in March, the ADP Employment Report showed Wednesday.
That was slightly better than economists had expected but fell short of the February report, which was revised higher. It was also the weakest monthly gain in private sector jobs since August. This relative slowdown is to be expected as the labor market moves towards full employment.
That said, there’s still a lot of work to be done in America’s job market.
Job openings are still near record highs and many workers are quitting their jobs for better opportunities. Last month, US employers had 11.3 million jobs to fill, while the number of hires stood at 6.7 million. In other words, the number of new hires, which is strong by historical comparison, pales in comparison to the millions of available jobs.
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“So we’re looking for those numbers to get closer together,” ADP chief economist Nela Richardson told reporters on a call following the report’s release.
Federal Reserve Chairman Jerome Powell referred to this phenomenon as an unhealthy level of tightness in the labor market, Richardson added. And she’s not convinced it will resolve by the summer.
March job gains were consistent across all sizes of businesses, though larger companies led gains.
“This is a competitive environment for talent. We still have a reduced overall workforce. Larger firms with larger budgets are able to compete in the local market a little easier,” Richardson said.
Job additions were also persistent across most sectors. Information technology was the only sector flat on the month, neither adding nor losing any positions. Leisure and hospitality led the job gains once again, adding 161,000 positions.
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The private sector jobs tally comes ahead of the government’s official assessment of the employment situation that is due Friday. The two reports are not correlated. Economists polled by Refinitiv project a gain of 490,000 jobs in March’s monthly employment report from the Bureau of Labor Statistics, which would be a slowdown from the surprisingly strong number seen in February.
That said, the pandemic has thrown a wrench into forecasters’ models, making it harder to predict the path of the recovery, and leading to frequent revisions in the official data.
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