U.S. private employers brought back more jobs than expected in November, with companies filling vacancies as the economic recovery progressed further along.
ADP said that private payrolls grew by 534,000 in November compared to October. According to Bloomberg data, consensus economists were looking for private payrolls to rise by 525,000. Private payrolls had grown by 570,000 in October, according to ADP's revised monthly figure.
The services sector added 424,000 payrolls last month, contributing to most of the headline gain in ADP's report. More than 136,000 jobs were added within services, with some of the industries most heavily impacted by the Pandemic last year recovering further. Professional and business services employers brought back 110,000 payrolls, and trade, transportation and utilities employers brought back 78,000. Both manufacturing and construction employers saw jobs grow by more than 50,000, according to a report from the goods-producing sector.
Private-sector employers have added back jobs on net in every month in 2021, reflecting the steady improvement in the labor market as the economy marched back toward pre-pandemic conditions. The latest ADP data did not capture the period when concerns over the newly discovered Omicron variant first appeared at the end of November, but some economists suggested its emergence would not seriously derail the economic recovery.
Since the pandemic, each wave of COVID has had less impact on the economy. There was a slowdown in restaurant traffic during the COVID wave that peaked in January. Neil Dutta, head of economics at Renaissance Macro Research, wrote in a note Tuesday that there wasn't a slowdown in the most recent wave. He said that he was skeptical that recent concerns over coronaviruses will spill into deeper issues for the U.S. economy. The labor market was facing a number of roadblocks in return to its pre-pandemic state even before the latest wave of virus-related fears resurfaced. Job openings have remained near record highs and the pace of hiring has not kept up with demand, leading to competition for workers, fast-rising labor costs and other disruptions. The labor market and the broader economy have improved over the course of the day.
The latest data shows the U.S. economy firing on all cylinders: Consumer spending is surging, the labor market is recovering, exports are bounding and the momentum in business investment is positive, according to Rubeela Farooqi, chief economist at High Frequency Economics. Even as the economy continues to face headwinds from supply chain disruptions and labor market dislocations, momentum is picking up. The Labor Department releases its official government jobs report on Friday, which will give more data on the labor market. Non-farm payrolls increased by 548,000 in November, a move that a consensus economists think is accelerating modestly from October's better than expected 531,000 rise. ADP has a print that is an inaccurate indicator of payroll trends seen in government data due to differences in methodology: ADP tallies employees actively on companies' payrolls towards its headline figures, while the Labor Department only counts those paid during the survey period for its non-farm payrolls.
Emily McCormick is a reporter for Yahoo Finance.