(Bloomberg) -- Employment at U.S. firms declined in March for the first time since 2017, as sweeping closures at small businesses began to take their toll on workers.
Businesses' payrolls dropped by 27,000 after a downwardly revised 179,000 gain a month earlier, according to ADP Research Institute data released Wednesday. The median estimate in a Bloomberg survey of economists had called for a decline of 150,000. The report reflects conditions in early March to align with Labor Department figures, and doesn't include bigger job losses that occurred later in the month.
Key Insights
- Small employers reduced employment by 90,000 jobs during the period, the steepest loss since April 2009, underscoring the more-precarious outlook for those enterprises. Mid-sized businesses added 7,000 workers while large businesses increased staff by 56,000.
- The figures highlight the abrupt reversal from consistently robust job gains as the pandemic endangers employment for millions nationwide. Even so, with many closures coming midway through the month, the worst losses are likely to still be ahead as many establishments now remain closed by the outbreak.
- The Labor Department's employment report due Friday is expected to show private payrolls decreased 123,000 in March while the unemployment rate rose to 3.8% from a 3.5% reading in February that matched a half-century low, according to the median estimate in a Bloomberg survey of economists. Initial jobless claims, a more timely labor-market barometer, are due for release Thursday and projected to show filings topped 3 million for a second straight week.
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- ADP's report showed service-provider employment dropped by 18,000 while goods-producing jobs decreased by 9,000. Payrolls for trade industries that include retailers slumped by 37,000, the most since 2009.
- Employment in leisure and hospitality fell by 11,000 while construction was down 16,000.
- Hiring at health care companies held up with a 44,000 gain, while manufacturing also saw an advance, rising by 6,000.
- ADP's payroll data represent firms employing nearly 26 million workers in the U.S.
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