GROWTH in America’s service sector held up in September, yet mixed news on jobs dampened sentiment across the pond yesterday.
While the Institute for Supply Management (ISM) non-manufacturing survey came in at 53 -- indicating growth -- employment activity contracted for the first time since August last year.
The drop in services employment was, however, at odds with a separate report from payrolls processor ADP showing overall private payrolls rose by 91,000, above economists’ expectations for an increase of 75,000.
ADP said most of the gains, which exceeded August’s count of 89,000, came from the service sector.
“The ADP report is generally not an accurate predictor of the Labor Department payroll data,” said Daniel Silver, an economist at JP Morgan in New York. “However, the report is consistent with other recent indicators that have signaled recent improvement in the labour market.”
The government will release its closely watched national employment report for September on Friday.
A separate study showed yesterday that employers announced 115,730 planned job cuts in September.
“Yet it is important to keep in mind that 80,000 cuts came from just two organisations: Bank of America and the US Army,” said John Challenger of Challenger, Gray & Christmas, which compiled the data.
City A.M. Reporter