- Private-sector businesses created 475,000 jobs in February, ADP said in its monthly hiring report.
- That easily exceeded the median estimate of 378,000 new jobs but marked a slowdown from revised January growth.
- Last month saw daily COVID infections plummet back to less concerning levels as the Omicron wave faded.
The US private sector showed healthy job growth in February as the Omicron wave eased, according to new economic data.
Private-sector payrolls rose by 475,000 last month, ADP said in its monthly jobs report on Wednesday morning. Economists surveyed by Bloomberg expected a gain of 378,000 private jobs. The reading shows job creation slowing slightly from January's increase of 509,000 payrolls. That count was revised from an initial reading that showed the private sector shedding 301,000 jobs through the month.
February saw the economic situation broadly improve as the elevated virus case counts seen at the start of the new year began to ease. Daily infections totaled roughly 108,000 at the end of last month, down from about 662,000 at the end of January. The swift decline has already prompted many state and local governments to relax economic restrictions kept in place through the Delta and Omicron waves.
The leisure and hospitality sector once again counted for the bulk of the month's gains, with such firms adding 170,000 new jobs through the month. Trade, transportation, and utilities businesses followed with a gain of 98,000 payrolls. Natural resources and mining companies gained just 2,000 jobs, marking the smallest gain of any sector.
Looking at business size, only large-scale companies saw significant increases in payroll counts. Businesses with more than 500 employees created 552,000 jobs in February, according to ADP.
Conversely, firms with fewer than 50 people lost 96,000 jobs, signaling small businesses had a far tougher time rehiring even as the virus situation normalized.
Economists shouldn't worry about that decline just yet, Ian Shepherdson, chief economist at Pantheon Macroeconomics, said Wednesday. It "makes no sense to care about" the initial ADP print, especially after January's sum was revised so significantly. Just as the latest ADP report showed how January's figures were far better than originally reported, the revised February count due for release in April could render the initial data "meaningless," Shepherdson said.
The latest ADP print also follows an extremely encouraging January jobs report. Government data out last month showed the US adding 467,000 nonfarm payrolls in the first month of 2022, sharply contrasting the previous ADP report's decline. Positive revisions to November and December job gains also signaled the Omicron wave had little effect on slowing hiring despite driving case counts to record highs.
The government's next payrolls report is slated for release on Friday. Economists expect the country to add 400,000 payrolls and for the unemployment rate to dip to 3.9% from 4%.