U.S. Private Sector Adds 37,000 Jobs In May, Much Fewer Than Expected

(RTTNews) - A report released by payroll processor ADP on Wednesday showed private sector employment in the U.S. increased by much less than expected in the month of May.

ADP said private sector employment rose by 37,000 jobs in May after climbing by a downwardly revised 60,000 jobs in April.

Economists had expected private sector employment to jump by 115,000 jobs compared to the addition of 62,000 jobs originally reported for the previous month.

"After a strong start to the year, hiring is losing momentum," said ADP chief economist Dr. Nela Richardson. "Pay growth, however, was little changed in May, holding at robust levels for both job-stayers and job-changers."

The report said year-over-year pay growth for job-stayers was little changed at 4.5 percent in May. Pay for job-changers jumped 7 percent year-over-year, unchanged from April's revised figure.

ADP said employment in the service-providing sector rose by 36,000 jobs, with increases by leisure and hospitality and financial activities jobs partly offset by decreases in professional and business services and education and health services jobs.

Meanwhile, the report said employment in the goods-producing sector edged down by 2,000 jobs amid dips in natural resources and mining and manufacturing jobs.

ADP also said employment at medium-sized establishments climbed by 49,000 jobs, while employment at small establishments fell by 13,000 jobs and employment at large establishments slipped by 3,000 jobs.

On Friday, the Labor Department is scheduled to release its more closely watched monthly employment report, which includes both public and private sector jobs.

Economists currently expect employment to increase by 130,000 jobs in May after jumping by 177,000 jobs in April, while the unemployment rate is expected to hold at 4.2 percent.