ADP Sees 176,000 Increase in June in U.S. Private Sector Jobs

* Small businesses represent payrolls with 1-49 employees
** Medium businesses represent payrolls with 50-499 employees
*** Large businesses represent payrolls with more than 499 employees

Note: All data included in the ADP National Employment Report is based on size of payroll. In some cases, small and medium-size payrolls belong to businesses employing more workers than indicated by the size grouping.

According to today’s ADP National Employment Report, employment in the nonfarm private business sector rose 176,000 from May to June on a seasonally adjusted basis. Employment in the private, service-providing sector rose 160,000 in June, after rising a revised 137,000 in May. Employment in the private, goods-producing sector added 16,000 jobs in June, while manufacturing employment added 4,000, reversing May’s decline. Construction employment rose by 8,000 jobs, more than reversing the declines of the two previous months. The financial services sector added 11,000 jobs from May to June.

“According to the ADP National Employment Report, the economy added 176,000 jobs in June, the majority of which came from the services-providing sector,” said Carlos A. Rodriguez, president and chief executive officer of ADP. “In spite of lingering fiscal uncertainties, it is encouraging to see companies creating jobs, particularly in the goods-producing sector where we see positive growth following two months of job loss.” Rodriguez added: “Since January of this year, our National Employment Report shows that, on average, businesses have added 173,000 jobs a month. We hope this growth continues at even a healthier rate across all sectors of the economy.”

According to Joel Prakken, chairman of Macroeconomic Advisers, LLC, “The gain in private employment is strong enough to suggest that the national unemployment rate may have declined in June. Today’s estimate, if reinforced by a comparable reading on employment from the Bureau of Labor Statistics tomorrow, likely will ease concerns that the economy is heading into a downturn.”

Prakken added: “There seems little doubt that recent employment gains have been restrained by heightened uncertainty over the European financial crisis and by growing concerns about domestic fiscal policy. However, the acceleration of employment since April does lend credence to the argument that unseasonably warm weather boosted employment during the winter months, with a ‘payback’ spread over April and May.”

Employment levels among medium-sized payrolls—those with 50 to 499 workers—rose by 72,000, while employment on large payrolls—those with 500 or more workers—increased by 11,000 jobs in June.

The matched sample used to develop the ADP National Employment Report was derived from ADP data, which, during 2011, averaged about 344,000 U.S. business clients and represented over 21 million U.S. employees. This approximately represents the size of the matched sample used this month.

Small Business Highlights – June Report:
Due to the important contribution small businesses make to economic growth, employment data that is specific to businesses with fewer than 50 employees is reported in the ADP Small Business Report^® each month. The ADP Small Business Report is a subset of the ADP National Employment Report.^*

Employment on small payrolls—those with up to 49 workers—rose 93,000 in June.

• Total nonfarm private small business employment: 93,000 jobs created
  • Goods-producing sector gained 9,000 jobs
  • Service-providing sector added 84,000 jobs