Preview: Due June 3 - U.S. May ADP Employment - Weekly ADP data remains firm
We expect a 100k increase in May’s ADP estimate for private sector employment, which would be similar to April’s 109k, which was the strongest since January 2025. It would not be as strong as a 4-week average of 37.75 in the weekly ADP employment report for the weeks to May 9 implies. The weekly ADP data in early April looked similar to the weekly data in early May.
Positive signals from the weekly ADP data are consistent with low initial claims, with the initial claims 4-week average lower in May’s payroll survey week than in April’s, though the weekly data has moved off the lows by the time of the survey week, and the signals from continued claims are not as strong.
We expect some slowing ion the non-farm payroll, to 85k from 115k overall and to 90k from 123k in the private sector. We thus expect a modest outperformance of private sector payrolls from May’s ADP report after a modest underperformance in April. The closure of Sprit Airlines caused 17k redundancies that should be caught by non-farm payrolls but may not be by ADP data.
We expect both ADP and payrolls to show some improvement in goods employment but some loss of momentum in services. Services, particularly those sensitive to consumer spending, are more vulnerable to strength in energy prices.
