Private sector employers added 177,000 jobs in April, according to payroll giant ADP, in a sign that the hiring pace is slowing somewhat from last year.
ADP also revised downward its job growth figures for March from 263,000 to 255,000.
“In April we saw a moderate slowdown from the strong pace of hiring in the first quarter,” said Ahu Yildirmaz, vice president and co-head of the ADP Research Institute, in a statement. “Despite a dip in job creation, the growth is more than strong enough to accommodate the growing population as the labor market nears full employment. Looking across company sizes, midsized businesses showed persistent growth for the past six months.”
Small businesses added 61,000 jobs last month, including 28,000 at businesses with between one and 19 employees, and 33,000 at companies with between 20 and 49 employees. Medium businesses with between 50 and 499 employees added 78,000 jobs in April. Large businesses gained 38,000 jobs, including 31,000 at companies with between 500 and 999 employees, and 7,000 at businesses with 1,000 employees or more.
The service-providing sector added 165,000 jobs, including 72,000 in professional and businesses services such as accounting and tax preparation. The goods-producing sector gained 12,000 jobs.
Mark Zandi, chief economist of Moody’s Analytics, which compiles the monthly national employment report with ADP, attributed the job growth slowdown in April to a pullback in construction and retail jobs. Outsized growth in construction jobs last winter due to the mild weather accounted for a loss of 2,000 jobs in that sector last month. Brick-and-mortar retailers also cut jobs in response to stiff competition from online merchants like Amazon.
Nevertheless Zandi sees signs of the labor market reaching what economists call “full employment,” as more Baby Boomers retire and immigration is limited.
“Wage growth is picking up, which is important for consumer spending and the economy picking up and making sure the expansion continues beyond its eighth birthday, which is in June,” Zandi said during a conference call Wednesday with reporters. “The other implication for a tight labor market is that job growth will slow. Businesses will find it increasingly difficult to fill open job positions, and there are already close to a record number of open job positions out there.”
He predicts the current unemployment rate of 4.5 percent will decline in the next two years to 4 percent. In terms of the jobs number that the U.S. Bureau of Labor Statistics will issue Friday, he predicts it will be around 185,000 to 190,000, as it also includes gains in the public sector.
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