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ADP: Jobs growth in May misses expectations

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ADP: Jobs growth in May misses expectations

Middle market creates 65,000 jobs; 201,000 jobs created during the month overall.

Private sector employment increased by 201,000 in May, according to payroll processing giant ADP. Middle market companies added 65,000 new workers, which comprised 32% of the total. 

Analysts had expected an increase of 215,000 overall.

Goods-producing employment rose by 9,000 jobs in May, after adding just 1,000 in April. The construction industry had another good month in May adding 27,000 jobs, up from 24,000 last month. Meanwhile, manufacturing lost 5,000 jobs in May, after losing 8,000 in April.

"Manufacturing lost 5,000 jobs in May, after losing 8,000 in April."

Service-providing employment rose by 192,000 jobs in May, a strong rise from 164,000 in April. The report indicates that professional/business services contributed 28,000 jobs in May, down from April’s 35,000. Trade/transportation/utilities grew by 56,000, up from April’s 41,000. The 12,000 new jobs added in financial activities is double last month’s 6,000.

"The labor market moved back up to the 200,000 jobs added mark in May, a number which has been something of a bellwether for healthy employment growth,” said Carlos Rodriguez, president and chief executive officer of ADP. “We hope that the May number is the beginning of an upward trend going into the summer months.”

Mark Zandi, chief economist of Moody’s Analytics, said, “The job market posted a solid gain in May. Employment growth remains near the average of the past couple of years. At the current pace of job growth the economy will be back to full employment by this time next year. The only blemishes are the decline in mining jobs due to the collapse in oil prices and the decline in manufacturing due to the strong dollar.”

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