Private-sector jobs growth in US slows due to sharp fiscal headwinds: ADP

WASHINGTON (AFP) - The private sector in the United States added only 119,000 jobs last month, the slowest job growth in seven months, according to a report by payrolls firm ADP published on Wednesday.

The April reading was well below the average analyst estimate of 155,000 jobs. ADP revised the March number down to 131,000 from an initial estimate of 158,000.

ADP said last month's job growth was the slowest pace of expansion since September 2012.

Mr Mark Zandi, chief economist of Moody's Analytics, which helps produce the report, said job growth appeared to be slowing in response to sharp fiscal headwinds.

"Tax increases and government spending cuts are beginning to hit the job market. Job growth has slowed across all industries and most significantly among companies that employ between 20 and 499 workers," Mr Zandi said.

The report came before the government's jobs data for April set for release on Friday.

The Labour Department is expected to report the US gained 155,000 non-farm jobs last month, with 166,000 in the private sector offset by a loss of 11,000 in the public sector. In March, the economy added only 88,000 jobs, the slowest growth in nine months.

Economists view the ADP report as an often unreliable indicator on job growth.

"We don't put too much stock in the ADP report, but it was a market mover last month and (bond) yields are dropping again in reaction this morning," said Mr Chris Low of FTN Financial.

Join ST's Telegram channel and get the latest breaking news delivered to you.