Private sector employment continued to decrease in the month of October, according to a report released by Automatic Data Processing, Inc. (ADP) on Wednesday, although the pace of job losses slowed for the seventh consecutive month.
The report showed that non-farm private employment fell by 203,000 jobs in October following a revised decrease of 227,000 jobs in September. Economists had expected a loss of 198,000 jobs compared to the decrease of 254,000 jobs originally reported for the previous month.
Despite recent indications that overall economic activity is stabilizing, ADP said that the employment is likely to decline for at least a few more months.
The continued drop in employment in October reflected weakness in both the service-providing and goods-producing sectors. The service-providing sector lost 86,000 jobs, while the goods-producing sector cut 117,000 jobs, including 65,000 jobs in the manufacturing sector.
Large businesses cut 53,000 jobs in October, while employment at medium-size businesses fell by 75,000 jobs. Small businesses also lost 75,000 jobs, marking the smallest drop in small businesses jobs since July of 2008.
The report also showed that construction employment fell by 51,000 jobs in October, marking the thirty-third consecutive monthly decline. With the decrease, construction employment has fallen by 1.675 million jobs since the peak in January 2007
ADP added that employment in the financial services sector fell by 18,000 jobs, the twenty-third consecutive monthly decline.
Peter Boockvar, equity strategist for Miller Tabak said, "The markets will await Friday's number before drawing conclusions on the labor market, but today's report still reflects a tough environment for jobs, albeit less so."
Friday morning, the Labor Department is scheduled to release its report on the employment situation in the month of October. The report, which includes government jobs, is expected to show that employment fell by about 175,000 jobs.
While this would reflect a slower pace of decline than the loss of 263,000 jobs reported for September, the unemployment rate is still expected to edge up to a new twenty-six year high of 9.9 percent.
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