US private payroll growth falls short in setback for Covid-19 recovery
US private payrolls increased less than expected in August, marking a major setback in the country’s economy from the coronavirus crisis.
Private payrolls rose by just 428,000 jobs last month, according to new figures from the ADP National Employment report.
This was well behind the 950,000 increase forecast by economists polled by Reuters.
The report, which is jointly developed with Moody’s Analytics, also revised July’s figures upwards from 167,000 to 212,000 jobs.
The data showed growth across almost all sectors of the economy, with only the information sector posting a decline in payroll growth. But the overall numbers remained weaker than anticipated.
The disappointing figures will fuel fears that recovery in the US labour market is losing pace as government stimulus designed to support workers and employers starts to dry up.
But the ADP report has a poor track record forecasting the private payrolls component of the official government report due to differences in methodology.
The Labor Department’s job report, which is due out on Friday, is expected to show private payrolls increased by 1.3m jobs in August after rising 1.5m in July, according to a Reuters poll.