Preview: Due April 3 - U.S. March ADP Employment - Maintaining trend, which is slower than payrolls
We expect a 130k increase in March’s ADP estimate for private sector employment growth, which would be in line with recent trend, but an underperformance of our 180k forecast for private sector non-farm payrolls, which would also be in line with trend. We expect overall payrolls to rise by 230k.
The last seven months have seen ADP gain by between 104k and 158k, that marking quite a sharp slowing from where trend was before August. In this period payrolls have outperformed ADP is each month apart from October, and the 50k difference we expect this month would be slightly less than those seen in the preceding three months.
There are some signs that the economy is losing a little momentum in Q1 after a strong second half of the year in 2023, though labor market signals, notably initial claims, suggest little reason to expect a break of trend in March. In Q2, when seasonal adjustments get tougher, some loss of momentum in non-farm payrolls to a pace more consistent with ADP data is likely.
