Hiring slowing but solid amid market unrest
Hiring by U.S. businesses slowed in January, but private-sector job growth remained solid in a sign the labor market has been able to withstand the recent financial market turmoil, according to a report released Wednesday by payroll firm Automatic Data Processing.
But on the heels of that report came better news: Home Depot announced its annual spring hiring spree will remain at the same level as in 2015, adding 80,000 workers at the nation’s largest home improvement chain.
Private employers added 205,000 net new jobs last month, down from an upwardly revised 267,000 in December, ADP said.
Economists had expected job gains to slow after an unusually strong finish last year and sharp downturns in major stock indexes that have been driven by concerns about slowing global growth.
But the ADP figure, which is watched as a signal of overall job growth, was better than the 190,000 that analysts had forecast.
“Job growth remains strong despite the turmoil in the global economy and financial markets,” said Mark Zandi, chief economist at Moody’s Analytics, which assists ADP in preparing the monthly report.
“Manufacturers and energy companies are reducing payrolls, but job gains across all other industries remain robust,” he said.
Falling oil prices have hurt the energy industry. At the same time, slowing economies in China and elsewhere around the world have caused the value of the dollar to increase, making U.S. manufactured goods more expensive abroad.
Manufacturing companies added no additional net jobs in January, down from a weak gain of 4,000 the previous month, ADP said.
But the construction industry posted another solid month, adding 21,000 net new jobs. That figure was down from 31,000 in December.
Economists are expecting the Labor Department to report Friday that overall job growth — private and public sector — slipped last month to 188,000. That would be down significantly from December’s robust 292,000 net new jobs.
Still, a figure close to 200,000 would indicate labor market growth continues to be solid in the wake of tumultuous financial markets and a slowdown in the U.S. economy at the end of last year.
The unemployment rate is expected to have held steady in January at 5 percent, the lowest level since 2008. And economists are forecasting a small rise in average hourly earnings after a slight drop in December.
Meanwhile, Home Depot, the Atlanta-based chain of home improvement stores, said Wednesday it is hiring more than 80,000 workers nationwide for its busy spring season, the same level as in recent years.
The retailer estimates that more than half of the temporary workers stay on for permanent employment.
The part-time and full-time jobs include sales, operations and cashier positions across all departments in stores as well as jobs at its distribution centers.
The hiring comes as Home Depot has been benefiting from shoppers’ increasing shift to renovate their homes in a housing market that has been solid
Home Depot said in December that it expects its annual revenue to surpass $100 billion in 2018 and backed its earnings and revenue outlook for the latest fiscal year that ended last month. It also said that sales at stores opened at least a year, a key measure of a retailer’s financial health, would rise 4.9 percent for the fiscal year that just ended.