The ADP National Employment Report, released each month preceding the U.S. Bureau of Labor Statistics official employment data, is viewed as a fairly accurate indicator of the state of the nation’s economy. The automated payroll giant takes a survey of a subset of its half million U.S. clients, a figure that represents about 340,000 businesses and 21 million employees in all private industrial sectors.
After a strong showing in April, the nation’s economy appears to have stalled in May. The ADP report, released yesterday, indicates that private sector employment rose by only 38,000 from April to May, and the estimate for March to April was revised slightly downward from 179,000 to 177,000. Employment in large businesses, those with 500 or more workers, decreased by 19,000, while medium sized firms with between 50 and 499 workers increased their workforce by 30,000. Small businesses, those with fewer than 50 workers, increased employment by 27,000 in May.
There were also a reversals of gains reported in April. Employment in the construction industry fell by 8,000 in May, following an increase in April, and employment in the manufacturing sector dropped by 9,000 after seven consecutive monthly gains. In addition, employment in the financial services sector decreased by 6,000 last month.
The Bureau of Labor Statistics will release its monthly Employment Situation Summary tomorrow morning and it is expected to mirror the ADP report. The dismal jobs numbers pose a continuing problem for President Obama as the 2012 presidential campaign kicks off and Republican aspirants to the White House take aim at the administration’s record on the economy. Further complicating the President’s defense of his economic record is the persistence of Black joblessness and the rumblings in some quarters of the Black community that the Obama administration has not done enough to ease unemployment among African-Americans. The economy is proving to be the primary Achilles heel for the administration and is the one area that Democrats appear vulnerable heading into 2012.