By Christopher Rugaber
U.S. companies added jobs at a modest pace last month, a private survey found, a sign that while hiring continues, it is only soaking up a relatively small proportion of the unemployed.
Payroll processor ADP said Wednesday that businesses added 428,000 jobs in August, a figure that before the pandemic would have represented a healthy gain. But the increase represents a small slice of the 12 million jobs that have been lost to the spread of the coronavirus.
ADP said the bulk of the gains were at large companies, which added 298,000 jobs. Small businesses with less than 50 employees gained just 52,000 positions, while medium-sized firms — with between 50 and 499 employees — added 79,000 jobs.
"Given the enormous job losses during the Viral Recession, job growth of around 400,000 per month means that it would take years for the labor market to recover from the coronavirus pandemic," Gus Faucher, an economist at PNC, said.
ADP's figures do not include government workers and frequently diverge from the Labor Department's official jobs report. The August jobs report from the government will be released Friday. ADP revised up its July job gain to 212,000, but that is still far below the 1.8 million additional jobs that month reported by the federal government.
Economists forecast that the Labor Department on Friday will report that 1.4 million jobs were added in August, while the unemployment rate is expected to have fallen to 9.8 percent from 10.2 percent, according to data provider FactSet.
The Federal Reserve, having raised interest rates at the fastest pace in four decades, is poised Wednesday to leave rates alone for the first time in 15 months to allow time to gauge the impact of its aggressive drive to tame inflation.
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