A job-seeker completes an application at a career fair held by civil rights organisation National Urban League as part of its annual conference, in Philadelphia.
NEW YORK: US private employers hired staff at the fastest pace in 13 months in December, data from a payrolls processor showed Wednesday, burnishing expectations that national jobs data due later in the week from the government will confirm the US economy was gathering steam at the end of last year.
The report was one of many in a rash of positive data, including a read on small-business hiring and holiday retail sales.
Companies added 238,000 jobs last month after an upwardly revised 229,000 in November, the ADP National Employment Report showed, easily topping expectations in a Reuters poll for a gain of 200,000. It was the largest monthly gain since November 2012 and brought the three-month average of corporate hiring to nearly 225,000 a month, the fastest such pace in 21 months.
In the ADP report, November’s job growth figure was revised up from the initially reported 215,000.
“We’re now going to start to see an economic recovery more typical of the economic recoveries we’ve seen historically,” said Mark Zandi, chief economist at Moody’s Analytics, which jointly develops the report with payrolls processor ADP. “It feels like the jobs market has kicked into a higher gear.”
In another positive read on the economy, the National Federation of Independent Business on Wednesday said small businesses hired the most workers in nearly eight years in December.
The data were likely a welcome affirmation of positive economic momentum for policy-makers at the Federal Reserve, who last month were confident enough in the recent improvement in activity to set plans to scale back their massive stimulus program, currently at $75 billion a month of bond purchases.
The minutes from the US central bank’s December meeting showed that many Fed members wanted to proceed with caution in trimming asset purchases, and most wanted to stress that further reductions were not on a preset course.
The ADP report comes two days ahead of the government’s nonfarm payrolls report, a measure of the labor market that is more comprehensive and includes both public and private sector employment.
Analysts are looking for 196,000 jobs to have been added in December, and a rise in private payrolls of 195,000. Both numbers would represent slight declines from November.
Moody’s Zandi said that based on the ADP report, he estimated that payrolls would show 230,000 jobs created in December. However, UBS economist Maury Harris argued that the ADP report has historically overstated payroll strength in December because ADP is less sensitive to weather and year-end issues.
“As firms belatedly delete payroll records for those separated from the firm during the year ... their end-of-year reconciliations of their payroll records result in a falsely high ADP estimate,” he wrote in a note to clients.