U.S. October ADP Employment - Hints at upside payroll risk
October’s ADP estimate of private sector employment of 86k is on the firm side of expectations and exactly matches September’s (revised from 90k) so the data is presumably reasonably representative of trend. The number is stronger than our payroll forecast of 45k private, 50k overall.
Low initial claims, stronger October consumer confidence and now the ADP report do however hint at some upside risk to our payroll forecast. The latest ADP report shows broader based strength than September’s, when education and health was clearly the strongest sector.
In this report the strongest sector was trade, transport and utilities at 39k, followed by education and health at 28k. The only large negative was professional and business at -27k. Despite signs of slowing in housing construction was firm at 13k, presumably led by data centers, though manufacturing saw a modest 1k decline.