Thursday, September 6, 2012

A Good Omen for Tomorrow's Employment Report? ... This Morning's ADP Jobs Report

Here's the breaking news, and it's favorable news, too.

Positive Signs Emerge for Jobs Market has the story:

"Private businesses added more workers than expected in August, according to a report released Thursday, while unemployment claims fell for the first time in four weeks, positive signs for the labor market ahead of Friday's monthly jobs report.

Private-sector jobs in the U.S. increased by 201,000 last month, according to a national employment report calculated by payroll processor Automatic Data Processing Inc. and consultancy Macroeconomic Advisers.

The August number was well above the 145,000 expected by economists. The July estimate was revised to 173,000 from the 163,000 reported last month.

The ADP survey tallies only private-sector jobs. The Bureau of Labor Statistics' nonfarm-payroll data, to be released Friday, include government workers, whose ranks have been falling in recent years as state and local governments have cut staff to close budget gaps.

Economists surveyed by Dow Jones Newswires expect total nonfarm payrolls increased by 125,000 in August, and the jobless rate is projected to remain at 8.3%.

Forecasters are unlikely to change their projections for Friday's payrolls, in part because ADP has had big misses in recent months. For June employment, for example, ADP originally estimated 176,000 new jobs, but the total original gain was only 80,000. . . .

Meanwhile, initial jobless claims were down 12,000 to a seasonally adjusted 365,000 in the week ending Sept. 1, the Labor Department said Thursday. Economists surveyed by Dow Jones Newswires expected 370,000 new applications for jobless benefits last week.

Claims for the week ending Aug. 25 were revised up to 377,000 from an initially reported 374,000. Unemployment claims are a measure of layoffs.

The four-week moving average of claims—which smooths out weekly data—grew by 250 to 371,250.

Friday's monthly jobs data could spur the Federal Reserve to take steps to stimulate the economy. The central bank has said it is monitoring the employment situation, and Chairman Ben Bernanke last week signaled in a speech in Jackson Hole, Wyo., that the Fed is considering another bond-buying program.

The Fed's policy makers next meet formally on Sept. 12 and 13."

Summing Up

It ain't great news, but at least it's not bad news.

Keeping our economic head above water isn't exactly a worthwhile long term goal, but it's better than drowning before the private sector rescuer arrives.

Let's hope that happens sooner rather than later. But happen it will.

Thanks. Bob.

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