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First Cut: ADP National Employment Report has another strong month in February

The ADP National Employment Report said private payrolls were up 183,000 in February after up 209,000 (previously 291,000). The report incorporated annual revisions.

Payrolls were up 11,000 for goods-producers in February due to a 18,000 increase in construction. In spite of the time of year, homebuilding, renovation, and repair are active. A combination of mild weather, low interest rates, and rising household income means this sector is unlikely to stop hiring any time soon. Payrolls were down 3,000 for natural resources and -4,000 for manufacturing.

Payrolls were up 172,000 in February for service-providers. There was strong hiring in professional and business services of up 38,000, education and healthcare of up 46,000, leisure and hospitality had a 44,000 gain, and transportation and utilities were 31,000 higher. In fact, gains were fairly evenly spread across the major sector headings.

The report came in a little above market expectations and is somewhat above expectations for the BLS numbers on private payrolls. The difference is not enough to lead forecasters to alter their numbers for Friday’s Employment Situation at 8:30 ET. But it does reinforce the continued strength in the labor market and Fed policymakers’ views that the fundamentals are solid for the US economy — for now.

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