ADP: Businesses added 241,000 jobs in March

Paul Davidson | USA TODAY

Show Caption Hide Caption Analyst: Jobs report is 'great sign' for economy U.S. employers went on a hiring binge in February, adding 313,000 jobs. The economy has now gained jobs for 89 straight months, the longest such streak on records. (March 9)

Did U.S. hiring surge for a third consecutive month?

Payroll processor ADP said Wednesday businesses added 241,000 jobs in March, signaling the government may announce another month of strong gains in its closely watched employment survey this week.

Economists expected ADP to tally 210,000 private-sector job gains. The Labor Department on Friday is forecast to announce 185,000 additional jobs in the public and private sectors.

“The job market is rip-roaring,” says Mark Zandi, chief economist of Moody’s analytics, which helps ADP compile the report. “The tight labor market continues to tighten.”

Some economists say the booming 313,000 new jobs Labor recorded in February were inflated by mild weather that pulled forward hiring in construction and retail. As a result, they’re looking for an offsetting moderation of job growth for March.

Industries that are hiring

Professional and business services led the gains with 44,000 new jobs. Trade, transportation and utilities added 40,000; health care, 29,000; and leisure and hospitality, 26,000.

Construction added 31,000 jobs as rebuilding continues in hurricane-hit areas of Texas and Florida and home builders respond to a housing shortage. And manufacturers added 29,000 jobs amid a strong global economy and a resurgence in oil drilling. It's good news that these two solid, middle-income sectors, which lost millions of jobs in the recession, are hiring at a brisk clip.

Small firms struggle to add workers

In March, small businesses added 47,000 jobs, midsize companies added 127,000 and large ones, 67,000.

The low unemployment rate is making it tougher for employers to find job candidates, and that’s especially posing a challenge for small businesses that typically have lower wages and benefits than their larger competitors.

What it means

ADP tries to predict Labor’s private-sector payroll totals. While it generally traces similar trends, it often varies from it significantly. In February, ADP reported 52,000 fewer job gains than the Labor survey. As a result, the ADP March tally could indicate that Labor will announce another solid job total, but there’s no guarantee.