The service sector was largely responsible for an increase of 144,000 of the 162,000 jobs added in September, beating analyst expectations, according to the latest monthly national employment report from payroll giant ADP.
In contrast, the goods-producing sector only added 18,000 jobs from August to September. ADP also revised downward the number of jobs added in July and August, reducing the July increase by 17,000 to an increase of 156,000, while the August increase was reduced by 12,000 to an increase of 189,000.
ADP found that small businesses with less than 50 employees added 81,000 jobs, while midsize businesses with between 50 and 499 employees added 64,000 jobs, and large businesses with 500 employees or more added 17,000 jobs. Of the 64,000 jobs created on midsize payrolls, 10,000 jobs were created by the goods-producing sector and 54,000 jobs were created by the service-providing sector.
Manufacturing employment rose 4,000, while construction employment rose 10,000, the strongest since March when mild winter weather was boosting construction activity. The financial services sector added 7,000 jobs in September, marking the fourteenth consecutive monthly gain.
“There was a huge bleed of finance employment during the financial crisis, followed by a period coming out of the recession when [the increase in] finance employment was essentially zero,” said Joel Prakken, chairman of Macroeconomic Advisers, which compiles the monthly national employment report with ADP. “Now in the last year, we’ve seen a jagged pattern of increases there. I think today’s number is just in line with what we’ve seen over the last year. It tends to be positive, but small, and there’s a lot of volatility around it still. Let’s face it, certain parts of this sector are still really struggling. Even though housing is picking up, mortgage-related processing employment is not anywhere near its peak and probably won’t be anytime soon, and there are other consolidations in the banking sector that are putting some pressure there. So I’m not looking for extremely robust growth in this part of the economy anytime soon.”