ADP Jobs Report - Just The Tip of a Titanic Iceberg

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In a word by one economist: Irrelevant. 

That was the take on ADP and Moody's Analytics' March jobs report released on Wednesday, which showed that U.S. employers reduced their payrolls by 27,000 in March.

Irrelevant because the numbers are just the tip of the iceberg in terms of what economists and market-watchers are expecting in the wake of the largest economic shutdown in modern history.

Indeed, the numbers were a not-so-telling precursor to what is expected to be among the deepest job cuts in generations amid the unprecedented coronavirus pandemic and global economic shutdown. 

"In one word: Irrelevant," noted Ian Shepherdson, chief economist with Pantheon Macroeconomics. "These numbers don’t matter; they capture only the leading edge of the virus hit." 

The ADP report Wednesday covered the period through March 12

Small businesses accounted for all of the reductions, slicing 90,000 from payrolls, with 66,000 of those reductions coming from companies that employ 25 people or less, ADP said.

The biggest job reductions came from trade, transportation and utilities (-37,000), followed by construction (-16,000) and administrative and support services (-12,000). Professional and technical services added 11,000 positions while manufacturing rose by 6,000.

Service-focused industries including restaurants and retail saw losses of 18,000, while goods producers dropped by 9,000.

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