The ADP Employment Report this morning was expected to show the creation of 5,000 new jobs last week. Instead we saw a net loss of 32,000. Small businesses were hit the worst with 120,000 jobs lost, while large cap establishments had sufficient gains to claw the average back up to the net -32,000. Six of the 10 sectors that ADP tracks were laying off more people than they hired. Professional Services was the biggest loser. We are in that business which is mildly concerning, but 100% commissioned people rarely actually get the axe. It’s more of a slow death for most.
Workers who kept their same jobs saw a year-over-year pay increase of 4.4%, just a tick under the last reading of 4.5%. Those who changed jobs did so for a bigger increase 6.3%, versus last month’s 6.7%. That declining differential indicates that fewer folks are being head-hunted–which the negative job creation number corroborates.
The BLS normally publishes their Jobs Report on the first Friday of the month, but after the month-long shutdown, they’re taking extra time to get their stats up to speed. They’ll make it up to us by publishing the November and December Reports on December 16th. which is a solid week after the next Fed meeting. But the tea leaves are pretty clear and the probability of a rate cut next week currently sits at 89%. The 10 Year is still at 4.0614%
