ADP report: Economy added 239,000 private jobs in October

Nov. 2 (UPI) -- Led by strong growth in the service-providing sector and medium-sized businesses, the economy added 239,000 jobs to its payrolls in October, according to the latest report national employment report on Wednesday morning.

The ADP report, done in collaboration with the Stanford Digital Economy Lab, comes two days ahead of official figures posted by the Labor Department on Friday. The new job numbers are 7.7% higher than this time last year.

Medium-size businesses, companies made up of 50 to 249 employees, added 241,000 jobs in October, enough to offset the 37,000-job downturn in small businesses of 20-49 employees and 23,000 lost jobs in the larger business category with 250 to 499 workers.

Small businesses, those with less than 20 employees, added 62,000 to their payrolls while businesses with 4,000 fewer people last month.

"This is a really strong number given the maturity of the economic recovery but the hiring was not broad-based," said Nela Richardson, chief economist for ADP, in a statement.

The service-providing sector added 247,000 jobs to the economy, led by the leisure and hospitality industry, which contributed 210,000 positions to that total. Good-producing jobs, though, lost 8,000 of their payrolls, led by manufacturing, which saw a reduction of 20,000 while seeing gains in natural resources and construction jobs.

"Goods producers, which are sensitive to interest rates, are pulling back, and job changers are commanding smaller pay gains," Richardson said. "While we're seeing early signs of Fed-driven demand destruction, it's affecting only certain sectors of the labor market."

The report said job changers continued to record double-digit, year-over-year pay increases, but momentum in those gains are starting to slow. For them, the annual pay growth edged down for the third straight month, to 15.2% in October from 15.7% in September.