Sector Snap: Payroll Services Stocks Rise

NEW YORK (AP) — A better-than-expected employment report from the government boosted shares of payroll services providers on Friday.

The Labor Department said the unemployment rate in February was 9.7 percent, unchanged from January. Employers cut 36,000 jobs, more than the 26,000 jobs lost in January.

Economists polled by Thomson Reuters had expected unemployment to tick up slightly, in part because of major storms in the East, and estimates that employers would cut 50,000 jobs.

"The February employment report is very encouraging," Moody's Economy.com economists Aaron Smith and Ryan Smith wrote in a research note. They predicted jobs growth in March.

Private employers shed 18,000 jobs last month, the government said. But the service sector, which makes up more than 80 percent of all U.S. jobs, added 42,000 jobs.

The service sector includes financial services, shops and restaurants, health care, consulting, tourism and education, among other industries.

Shares of Paychex Inc., which makes money by processing paychecks for small businesses, rose 77 cents, or 2.5 percent, to $31.10 in midday trading.

Meanwhile, shares of Automatic Data Processing Inc. gained $1.30, or 3.1 percent, to $43.01. Administaff Inc. added 13 cents to $19.09.

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