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ADP Says U.S. Firms Hired 192,000 Workers, Above Forecast

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Jan. 30 (Bloomberg) -- Companies took on more workers than projected in January, a sign the U.S. labor market was staying on the path to expansion at the start of the year, according to a private report based on payrolls.

The 192,000 increase in employment, the most since February 2012, followed a revised 185,000 gain in December, figures from the Roseland, New Jersey-based ADP Research Institute showed today. The median forecast of 38 economists surveyed by Bloomberg called for a January advance of 165,000.

Growing payrolls show that U.S. businesses see strong enough demand in the future to hire even as lawmakers in Washington spar over the federal budget. A Labor Department report on Feb. 1 may show companies added 168,000 workers to staff last month while the unemployment rate held at 7.8 percent, according to the median estimate in a Bloomberg survey.

“The job market is slowly but steadily improving,” Mark Zandi, chief economist at Moody’s Analytics Inc., said in a statement. Moody’s produces the figures with ADP. “Construction is finally kicking into gear and more than offsetting the weakness in manufacturing.”

Economists’ estimates for the ADP measure ranged from 120,000 to 235,000. Job creation in December was previously reported by ADP as 215,000.

Economy Shrank

In another report, the Commerce Department said the economy in the U.S. shrank in the fourth quarter. Gross domestic product, the volume of all goods and services produced, dropped at a 0.1 percent annual rate, according to the department’s figures.

U.S. stocks were little changed at the start of trading, as measured by the Standard & Poor’s 500 Index, at 9:31 a.m. New York time. The S&P 500 fell less than 0.1 percent to 1,507.41.

Goods-producing industries, which include manufacturers and construction companies, increased their headcounts by 15,000, today’s ADP figures showed. Construction employment was also up by 15,000, while factory employment declined by 3,000.

Service providers added 177,000 jobs. Businesses involved in financial activities increased staff by 12,000, professional and business services raised staff by 40,000 and trade, transportation and utilities hired 33,000.

Company Payrolls

Payrolls at companies employing 500 or more workers dropped 2,000 in January. Medium-sized businesses, with 50 to 499 employees, rose by 79,000, and small companies increased payrolls by 115,000, ADP said.

In October, ADP changed the method it had used to derive its employment figures since 2001. The group’s report is now calculated from a larger sample using a new methodology, and it is released jointly with Moody’s of West Chester, Pennsylvania.

Later this week, the Labor Department’s national employment report may show that overall hiring including government jobs rose 161,000 last month after a 155,000 gain in December, according to the Bloomberg survey median.

Progress toward finding jobs for the 12.2 million unemployed Americans would help the economy overcome the fiscal contraction expected this year. Congress on Jan. 1 allowed payroll taxes to revert to 6.2 percent from 4.2 percent and boosted the levy on top income earners. Lawmakers are now battling over spending reductions scheduled for March 1 that would further crimp growth.

To contact the reporters on this story: Alex Kowalski in Washington at

To contact the editor responsible for this story: Christopher Wellisz at

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