ADP: Private payrolls June 2020


A waitress wearing a mask helps customers at Cafe Luxembourg’s outdoor seating as the city moves into Phase 2 of re-opening following restrictions imposed to curb the coronavirus pandemic on June 22, 2020 in New York City.

Alexi Rosenfeld | Getty Images

Companies in June continued to bring workers back from their pandemic furlough as the national economy slowly came back to life.

Private payrolls grew by 2.369 million for the month, a bit lower than the 2.5 million expectation from economists surveyed by Dow Jones, according to a report Wednesday from ADP and Moody’s Analytics.

The total actually represented a decline from the previous month, which saw a dramatic upward revision to 3.065 million. ADP initially said May saw a loss of 2.76 million. The firm did not immediately explain the massive shift.

For June, hiring was especially strong in the pivotal leisure and hospitality industry, which took the biggest hit as measures aimed at curbing the coronavirus spread meant shutting down most bars and restaurants across the country. The sector added 961,000, by far the biggest gain in any industry.

“Small business hiring picked up in the month of June,” said Ahu Yildirmaz, vice president and co-head of
the ADP Research Institute. “As the economy slowly continues to recover, we are seeing a significant rebound in industries that once experienced the greatest job losses.”

In addition to the big gains in hospitality, construction — another hard-hit industry — added 394,000 and manufacturing rose by 88,000. The goods sector in total saw a net gain of 457,000 positions.

On the services side, which grew by 1.912 million, other big gainers were trade, transportation and utilities (288,000), education and health services (283,000), and the “other services” category (215,000). Professional and businesses services added 151,000 and financial activities, which includes Wall Street jobs, was up 65,000.

Small businesses added 937,000 to lead industries by size. Companies with 500 or more workers were up 873,000 while medium-sized firms added 559,000.

The ADP count comes the day before the Labor Department releases its official nonfarm payrolls count for June. Economists are looking for a gain of 2.9 million after May’s 2.5 million jump,  a number that contrasted sharply with the ADP count and shattered Wall Street estimates of an 8 million job loss.

The volatile numbers point up how difficult estimating the jobs situation is amid an economy struggling to get back to normal following the coronavirus-inducted shutdown. The national unemployment rate was a 50-year low 3.5% prior to the shutdown and is now 13.3%.

Even as jobs seem to be coming back, states are still trying to catch up with claims for unemployment insurance. That weekly number also comes out Thursday and is expected to indicate another 1.38 million new claims even as jobs on net are brought back. The discrepancy is part a backlog at the state level and possible counting errors under a special program targeted at pandemic-related claims, according to a Bloomberg News report Wednesday.


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