ADP: Manufacturing Employment Rose by 40,000 in November

ADP said that manufacturing employment remained a bright spot in November, with the sector adding 40,000 net new workers for the month.

As such, manufacturers continue to hire at a rather robust rate as firms react to increased activity and an improved economic outlook. The sector has hired an average of 19,336 per month year-to-date—a significant turnaround from 2016’s more-sluggish pace. Overall, we continue to see signs that the labor market for manufacturing firms has tightened considerably, with business leaders citing notable challenges in attracting talent. We expect continued strength in job growth moving forward.

Meanwhile, total nonfarm private employment increased by 190,000 in November. While that was lower than the gain of 235,000 seen in October, it continued to reflect overall strength in the labor market, rebounding from hurricane-related softness in the September data. Nonfarm private payrolls have increased by 208,488 per month on average year-to-date, which was notably higher than the 179,327 workers added each month in the second half of 2016.

In November, the largest employment growth included education and health services (up 54,000), professional and business services (up 47,000), trade, transportation and utilities (up 36,000) and leisure and hospitality (up 25,000). Small and medium-sized businesses (e.g., those with less than 500 employees) accounted for 78.4 percent of the net job growth in November.

On Friday, we would expect to see similar data from the Bureau of Labor Statistics (BLS), with the current consensus also indicating an increase of around 190,000 nonfarm payrolls in November. In addition, we would anticipate job growth for manufacturers that remained strong. In the BLS data, the sector added 24,000 workers in October, averaging 13,800 per month year-to-date, and we would expect numbers consistent with that trend in November.

Chad Moutray

Chad Moutray

Chad Moutray is chief economist for the National Association of Manufacturers (NAM) and the Director of the Center for Manufacturing Research for The Manufacturing Institute, where he serves as the NAM’s economic forecaster and spokesperson on economic issues. He frequently comments on current economic conditions for manufacturers through professional presentations and media interviews. He has appeared on Bloomberg, CNBC, C-SPAN, Fox Business and Fox News, among other news outlets.
Chad Moutray

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