The U.S. economy added 178,000 private, non-farm jobs in July, according to the monthly employment report released this morning by payroll-management firm ADP and its partner Moody's Analytics. The seasonally adjusted result is a 12 percent increase from June's addition of 158,000 jobs, but a 22 percent decline over the previous July, when 229,000 jobs were created. Last month's report marks the fifth consecutive month of growth in the labor market, and the largest addition of jobs month-over-month in 2017
“The American job machine continues to operate in high gear. Job gains are broad-based across industries and company sizes, with only manufacturers reducing their payrolls," said Mark Zandi, chief economist of Moody’s Analytics, in a press release. "At this pace of job growth, unemployment will continue to quickly decline.”
Small businesses—those with one to 49 employees—added 50,000 jobs. Within that figure, firms that employ fewer than 20 people added 27,000 jobs, and firms that have 20 to 49 employees added 22,000 jobs. For the fourth consecutive month, mid-sized businesses—those with 50 to 499 employees—saw the biggest employment gains, adding 83,000 jobs, accounting for 46 percent of all new jobs added in July. Twenty-five percent (45,000) of payroll additions in July occurred at large businesses with more than 500 employees.
Ninety-seven percent of July's job gains can be attributed to the service-providing sector, which added 174,000 jobs, marking the fifth month that continued growth in the sector has been the anchor of ADP's job report. The service-providing sector includes jobs in trade, transportation, and utilities; information; financial activities, professional and business services; education and health; leisure and hospitality; and other services. All seven sub-sectors experienced growth in July, with professional and business services, and education and health services reporting the largest gains.
The professional and business services sector—which includes architecture and engineering firms—has been on an upward trajectory since March. The addition of 65,000 jobs in July accounts for 37 percent of all new jobs added in the service-providing sector last month.
The goods-producing sector, which includes jobs in natural resources and mining, construction, and manufacturing, added 4,000 jobs in July, a marked improvement from June, when the sector reported net-zero job growth after significant losses in construction and natural resources employment. Construction and natural resources and mining sub-sectors saw payroll additions of 6,000, and 3,000, respectively in July, while the manufacturing sub-sector reported a loss of 4,000 jobs, following the addition of 6,000 positions in June.
“Job gains continued to be strong in the month of July,” said Ahu Yildirmaz, vice president and co-head of the ADP Research Institute in the press release. “However, as the labor market tightens employers may find it more difficult to recruit qualified workers.”
ADP's national employment report is often used as a precursor for the monthly Bureau of Labor Statistics jobs report, for which the July version will be released this Friday. For more information, read the full employment report from ADP.
