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Private-sector payrolls add 187,000 jobs, ADP reports

Small businesses accounted for more than half of the new position in January, the report said. Also, ADP cuts its estimate of December gains by 50,000 to 247,000.

February 02, 2011|By Ruth Mantell

Washington — Private-sector employment rose in January, with strength in all major industries, according to a closely watched report released Wednesday.

Private-sector employment increased by 187,000 jobs, with the services sector gaining 166,000 and the goods-producing sector increasing 21,000, the report by Automatic Data Processing showed.

Employment rose 97,000 at small businesses, 79,000 at medium businesses and 11,000 at large businesses.

"Early in this recovery, small firms appeared to be lagging, held back by credit constraints. Apparently, not anymore," wrote Paul Ashworth, chief U.S. economist with Capital Economics.

For December, ADP reported that private payrolls gained 247,000 jobs, compared with a prior estimate of 297,000.

"According to this measure, employment is accelerating, and while January's addition is less than December's, we remain of the belief that employment gains will continue over the course of the year," said Dan Greenhaus, chief economic strategist with Miller Tabak & Co.

On Friday, the government will report on January's nonfarm payrolls, which also include government workers. Economists polled by MarketWatch are looking for a gain of 140,000 jobs, and for the unemployment rate to rise to 9.5%.

For December, the government reported that nonfarm payrolls gained 103,000 jobs, while the unemployment rate fell to 9.4%.

The ADP report echoes other recent positive jobs data. On Tuesday, the Institute for Supply Management reported that a gauge of manufacturing employment rose in January.

Elsewhere Wednesday, outplacement consultancy Challenger, Gray & Christmas Inc. reported that employers announced plans to cut almost 39,000 jobs in January, down from about 71,000 job cuts a year earlier.

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