The ADP employment report released today was worse than expected, as just 428,000 jobs were added last month. Economists had predicted 950,000 new jobs in the private payrolls report for August.
The report showed that large companies had the strongest job gains with the leisure and hospitality sector adding 129,000, the most of any. The spring lockdown decimated the industry as hotels and restaurants shut their doors while flights were grounded.
What this means: For those watching these figures as an indicator for Friday's government jobs report, disappointment could be on the horizon. Economists expect 1.4 million jobs to be added to the economy in August, bringing the unemployment rate to 9.8%. It would be the first time since April that the jobless rate is below the peak of the Great Recession.
July's job data showed the US labor market’s third straight month of solid improvement from the depths of the pandemic. However millions of Americans who lost their jobs at the beginning of the pandemic remain unemployed.
Economists are worried that the tepid recovery in the US job market could run out of steam this fall should coronavirus cases surge again just as federal stimulus money runs out. The world's top developed economies are all officially in a recession. What happens next is far from certain.










