U.S. employers added modestly fewer-than-expected jobs into the economy last month, according to a private sector reading from payroll services provider ADP, suggesting employment growth in the world’s largest economy could be slowing.
Around 183,000 new jobs were created in February, ADP said, just shy of the 189,000 consensus. However, ADP also revised its January report to show a gain of 300,000 from its initial estimate of 213,000.
The reading could impact analysts’ forecast for Friday’s employment report from the Bureau of Labor Statistics, which is expected to show around 190,000 new jobs and a headline unemployment rate of 3.9%.
“We think ADP overstates Friday’s official number; we expect a 125K increase, representing a correction after the outsized January leap,” said Ian Shepherdson of Pantheon Macroeconomics. “We think the January official number was elevated by favorable weather effects and double-counting of federal government workers taking second jobs during the shutdown.”
The U.S. dollar index, which tracks the greenback against a basket of six global currencies, slipped marginally lower to 96.88 following the ADP release, while equity futures linked to the Dow Jones Industrial Average slipped lower to indicate an opening bell decline of around 32 points.