UPDATE: Private-sector job growth slows in September, ADP says
By Greg Robb, MarketWatch
Private sector adds 135,000 jobs in September, hurricanes trimmed jobs by estimated 50,000-60,000
The numbers: Private-sector employment slowed in September as firms added 135,000 jobs ADP reported Wednesday. The gain was close to estimates of economists polled by Econoday, which had forecast a September gain of 140,000 jobs, compared with an original reported increase of 237,000 for August. On Wednesday, ADP revised August's gain to 228,000.
What happened: The small-business sector lost jobs in September, while medium and large firms reported payroll gains. The trade sector was weak, while manufacturing showed a gain of 18,000 jobs.
Big picture: The ADP data, produced in conjunction with Moody's Analytics, may be more important than usual this month as it should be much less affected by hurricanes than the government data. Workers are included in ADP payrolls even if they are not paid due to bad weather. Still, Moody's Analytics' Chief Economist Mark Zandi said hurricanes Harvey and Irma cut job gains by 50,000-60,000 jobs, mainly by forcing smaller "mom-and-pop" retailers to close.
Analysts look to the ADP report for a hint of what the Labor Department's jobs report, due two days later, may hold. Economists polled by MarketWatch expect the government's report to show that nonfarm-payroll jobs rose by 75,000 in September, after a gain of 156,000 in August. Estimates are all over the place given the unknown drag from the hurricanes.
What are they saying?: Paul Ashworth, chief U.S. economist at Capital Economics, said he was surprised how much impact the hurricanes had on the ADP data. "If the ADP measure was up only 135,000, then there could be downside risks to our estimate that non-farm payrolls increased by 100,000," he said. Still, markets and the Fed will chalk up any weakness to the hurricanes and largely ignore it, he said.
Market reaction: Stocks traded mostly lower (http://www.marketwatch.com/story/us-stocks-set-to-catch-their-breath-after-record-run-but-tesla-jumps-2017-10-04).Treasury yields were little changed (http://www.marketwatch.com/story/treasury-yields-retreat-as-global-stocks-turn-lower-dollar-softens-2017-10-04) after the ADP report.