US private sector employment rises more than expected in October - ADP

Private sector employment in the US rose more than expected in October, according to data released by ADP on Wednesday.

Employers added 235,000 jobs versus expectations for a 200,000 increase. The figure for September was revised down from 135,000 to 110,000.

Small businesses with fewer than 50 employees added 79,000 positions, while medium business with between 50 and 499 employees added 66,000 jobs. Meanwhile, large companies with 500 or more employees added 90,000 jobs in October.

The goods-producing sector created 85,000 jobs, while the services sector added 150,000.

Mark Zandi, chief economist at Moody’s Analytics, said: "The job market rebounded strongly from the hit it took from Hurricanes Harvey and Irma. Resurgence in construction jobs shows the rebuilding is already in full swing. Looking through the hurricane-created volatility, job growth is robust."

Meanwhile, Ahu Yildirmaz, vice president and co-head of the ADP Research Institute, said: "The job market remains healthy and hiring bounced back with one of the best performances we’ve seen all year.

"Although the service providing sector was hard hit last month due to the weather, we saw significant growth in professional services, especially in the higher paid professional technical jobs. Additionally, small businesses rebounded well from the impact of Hurricanes Harvey and Irma, posting very strong gains.”

Capital Economics economist Paul Ashworth said: "The ADP payroll private employment measure is not the best predictor of the official non-farm payroll employment at the best of times and is even less useful in the aftermath of the hurricane disruption. Accordingly, it’s probably best to ignore the 235,000 increase reported.

"The problem is that the ADP counts someone as employed as long as they were registered on the payroll count, whereas the official non-farm measure requires an employee to be paid. The latter measure was consequently more affected by Hurricanes Harvey and Irma, with Irma making landfall in the middle of the payroll survey period for September."