U.S. companies added more jobs than forecast in January, a sign that the labor market may be gradually improving as Covid-19 infections begin to ebb.
Company payrolls increased by 174,000 during the month, according to ADP Research Institute data released Wednesday. The median projection in a Bloomberg survey of economists called for an increase of 70,000. The prior month was revised up to a 78,000 decline.
The data suggest that the labor market may be starting to pick up again after employment fell in December. Hiring could see an additional boost as vaccines accelerate and states like New York and California lift some business restrictions.
The report precedes Friday’s monthly jobs report, which is projected to show that private payrolls grew by 105,000 in January after declining by 95,000 in December.
The gain in employment was led by services employment, which rose by 156,000, the ADP data showed. Payrolls at goods producers increased 19,000, led by construction.
“Looking ahead, the initial reopening in some states ought to provide a modest lift to payrolls,” Ian Shepherdson, chief economist at Pantheon Macroeconomics, said in a note.
The overall increase was across companies of all sizes. Medium-size companies added the most jobs, or 84,000.
ADP’s payroll data represent firms employing nearly 26 million workers in the U.S.
Other Details:
• Construction companies added 18,000 jobs in January, the most since November
• Among services companies, health care firms added the most jobs followed by leisure and hospitality
• Large companies added 39,000 jobs, while small companies gained 51,000
—With assistance from Chris Middleton and Reade Pickert.
This article was provided by Bloomberg News.