U.S. Private-Sector Employment Increased by 133,000 Jobs in May, According to ADP National Employment Report

U.S. Private-Sector Employment Increased By 133,000 Jobs in May, According to ADP National Employment Report

ROSELAND, N.J. – May 31, 2012 Private-sector employment increased by 133,000 from April to May on a seasonally adjusted basis, according to the latest ADP National Employment Report® released todayThe ADP National Employment Report, created by Automatic Data Processing, Inc. (ADP®), in partnership with Macroeconomic Advisers, LLC, is derived from actual payroll data and measures the change in total nonfarm private employment each month. The estimated gain from March to April was revised down modestly, from the initial estimate of 119,000 to a revised estimate of 113,000.

U.S. Nonfarm Private Employment Highlights – May 2012 Report:

  • Total employment:   +133,000
     
  • Small businesses:*   +67,000
  • Medium businesses:**   +57,000
  • Large businesses:***     +9,000
     
  • Goods-producing sector:   +1,000
     
  • Service-providing sector:   +132,000
     
Addendum:    
  • Manufacturing industry:       - 2,000

* 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 133,000 from April to May on a seasonally adjusted basis.  Employment in the private, service-providing sector rose 132,000 in May, after rising a revised 119,000 in April.  Employment in the private, goods-producing sector added 1,000 jobs while manufacturing employment declined by 2,000 in May, its second consecutive monthly decline.  Construction employment fell by 1,000, the second consecutive decline following six monthly advances, likely driven in part by unusually warm weather during the winter months. The financial services sector added 8,000 jobs from April to May.

“This month’s ADP National Employment Report shows an increase of 133,000 new jobs, nearly entirely driven by the service-providing sector,” said Carlos A. Rodriguez, president and chief executive officer of ADP.  “Over the first quarter of 2012, monthly employment gains averaged just over 200,000.  However, during the first two months of the second quarter, the average monthly employment gain slipped to 123,000.  We hope to see expanded job creation in the future, fueled by greater performance in the goods-producing and service-providing sectors alike,” Rodriguez added.

According to Joel Prakken, Chairman of Macroeconomic Advisers, LLC, “While May’s increase was the twenty-eighth consecutive monthly advance, it nonetheless reflected a notable slowdown in the recent pace of hiring.  The sharpness of the deceleration seems consistent with other incoming data suggesting the economy, weighed down by heightened uncertainty over the European financial crisis and by growing concerns about domestic fiscal policy, slowed early in the year.”

Prakken added: “The modest rise in private employment suggests that the national unemployment rate probably did not decline in May unless the labor force continued to decline.  Hence, today’s estimate, especially if reinforced by a weak reading on employment from the Bureau of Labor Statistics on Friday, likely will fuel concern that the economy is slowing fundamentally for the third summer in a row.” 

Employment levels among medium-sized payrolls—those with 50 to 499 workers—rose by 57,000.  Employment on large payrolls—those with 500 or more workers—increased by 9,000 jobs.

NER table 1

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 – May 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 67,000 in May. 

  • Total nonfarm private small business employment: 67,000 jobs created
    • Goods-producing sector gained 4,000 jobs
    • Service-providing sector added 63,000 jobs

*   All size 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.

Additional information about small business employment, including charts on monthly job growth and employment levels, along with historical data, is available at http://www.smallbusinessreport.adp.com.

NER chart 2

To obtain additional information about the ADP National Employment Report, including additional charts, supporting data and the schedule of future release dates, or to subscribe to the monthly email alerts and RSS feeds, please visit www.ADPemploymentreport.com

The June 2012 ADP National Employment Report will be released July 5, 2012 at 8:15 AM ET.

About the ADP National Employment Report®

The ADP National Employment Report®, sponsored by ADP®, was developed and is maintained by Macroeconomic Advisers, LLC.  It is a measure of employment derived from an anonymous subset of roughly 500,000 U.S. business clients.  During 2011, this subset averaged about 344,000 U.S. business clients and represented over 21 million U.S. employees working in all private industrial sectors.  The ADP Small Business Report is a monthly estimate of private nonfarm employment among companies in the United States with 1-49 employees and is a subset of the ADP National Employment Report.  The data for both reports is collected for pay periods that can be interpolated to include the week of the 12th of each month, and processed with statistical methodologies similar to those used by the U.S. Bureau of Labor Statistics to compute employment from its monthly survey of establishments.  Due to this processing, this subset is modified to make it indicative of national employment levels; therefore, the resulting employment changes computed for the ADP National Employment Report are not representative of changes in ADP’s total base of U.S. business clients.

For a description of the underlying data and the statistical properties of the series, please see “ADP National Employment Report: Development Methodology” at http://ADPemploymentreport.com/methodology.aspx.

About ADP

Automatic Data Processing, Inc. (NASDAQ: ADP), with about $10 billion in revenues and approximately 570,000 clients, is one of the world's largest providers of business outsourcing solutions. Leveraging over 60 years of experience, ADP offers a wide range of human resource, payroll, tax and benefits administration solutions from a single source. ADP's easy-to-use solutions for employers provide superior value to companies of all types and sizes. ADP is also a leading provider of integrated computing solutions to auto, truck, motorcycle, marine, recreational vehicle, and heavy equipment dealers throughout the world. For more information about ADP or to contact a local ADP sales office, reach us at 1.800.225.5237 or visit the company's Web site at www.ADP.com.

About Macroeconomic Advisers, LLC

Macroeconomic Advisers, LLC (MA) has been the most trusted source for U.S. macroeconomic forecasts and commentary, monetary and fiscal policy analysis, and econometric modeling for 25 years. MA's clients include leading financial service firms, nonfinancial corporations, key policymaking agencies of the U.S. government, as well as State and Foreign Government agencies.  Additional information on Macroeconomic Advisers, LLC is available on the company's website, www.MacroAdvisers.com.  

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