US Private Sector Added More Jobs Than Expected in December

January 3, 2019 Updated: January 3, 2019

WASHINGTON—U.S. private-sector employment rose substantially in December, suggesting continued solid job growth despite stock-market volatility and signs of a slowing economy.

According to a report by payroll processor ADP, companies added 271,000 new jobs last month, the biggest monthly gain in nearly two years. The jobs number also beat economists’ estimates, which was 178,000.

The ADP report, which is jointly developed with Moody’s Analytics, is published generally ahead of the Bureau of Labor Statistics (BLS) report, giving markets a heads-up on the official job numbers. BLS will release its December report on Jan. 4.

“Businesses continue to add aggressively to their payrolls despite the stock-market slump and the trade war,” Mark Zandi, chief economist of Moody’s Analytics, said in a press release.

He said that favorable weather in December helped boost the job market.

“At the current pace of job growth, low unemployment will get even lower,” Zandi said.

Last year, the unemployment rate fell to 3.7 percent, the lowest rate in nearly 50 years. Job openings have surged to record-high levels and wages have started to rise.

“We wrapped up 2018 with another month of significant growth in the labor market,” Ahu Yildirmaz, vice president and co-head of the ADP Research Institute, said in the press release. “Although there were increases in most sectors, the busy holiday season greatly impacted both trade and leisure and hospitality.”

Small businesses added 89,000 positions in December, the strongest month of job growth all year.

The employment numbers, however, could face a headwind this month. The partial government shutdown that began in December will likely affect January job numbers, according to Kevin Hassett, chair of the White House Council of Economic Advisers.

That’s mainly because of the furloughed government employees who are affected by the shutdown, since they are considered unemployed during that period.

“So when we see the January jobs number, it could be a big negative,” Hassett told reporters Jan. 3. But those workers will ultimately be paid, he said.

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