The U.S. private-sector economy generated more jobs in January than many analysts predicted, which suggests the jobs market has started the year off strong and could even see improved growth throughout the year, Bloomberg reports.
According to the news source, such were the results of the latest ADP Employer Report, which noted that 192,000 jobs were created in January - the biggest rise since February 2012. The report also showed the firm revised its December numbers up to 185,000 new jobs. The report beat the estimates from several analysts, who called for employment to rise by 165,000.
The jump in employment suggests businesses around the country are confident they can grow their operations in 2013 despite the political uncertainty surrounding the federal budget and debt ceiling concerns. Many analysts say the ADP report may have overshot actual hiring numbers, and that the official government data, due out on February 1, will show employers added 168,000 new jobs, and that the unemployment rate likely went unchanged at 7.8 percent.
"U.S. private sector employment got off to a good start in 2013, as 192,000 jobs were added during the month of January," said Carlos A. Rodriguez, president and chief executive officer of ADP. "According to the ADP National Employment Report, private sector employers created an average of 183,000 new jobs per month during the last three months. This is an encouraging sign of steady improvement in the job market."
Experts at Moody's Analytics Inc, which does the research for the ADP report, say the new data is encouraging for all businesses and job seekers.
"The job market is slowly but steadily improving," said Mark Zandi, chief economist at Moody's. "Construction is finally kicking into gear and more than offsetting the weakness in manufacturing."
The report noted that the goods-producing sector, which comprises manufacturing and construction firms, added 15,000 new jobs in January. This could be especially good news for anyone looking for an engineering job, considering the construction sector alone added 15,000, while manufacturers lost 3,000 jobs.
The service industry beat out its goods-producing counterpart by a large margin, adding 177,000 jobs this month. Financial services companies brought on 12,000 new workers, while the professional and business services sector, which includes temporary staffing firms, added 40,000 new jobs. Employment in the trade, transportation and utilities industries rose by 33,000, according to the report.
According to the Memphis Business Journal, one of the best takeaways form the report was the huge jump in employment among small businesses. These firms made up the largest increase in jobs, with 115,000 new positions added in businesses with fewer than 50 employees.
Businesses with more than 1,000 employees actually bled the economy of jobs in January, losing 9,000 positions.
According to Bloomberg, the report suggests the country is on the right path for helping the 12.2 million people who have still not found a job. If such hiring is reflected in the official report from the Bureau of Labor Statistics, and continues throughout the year, it could help businesses overcome the fiscal contraction many analysts expect will take place in 2013.
In an effort to keep the country from falling over the heatedly discussed fiscal cliff, Congress passed a measure on January 1 that allowed payroll taxes to return to 6.2 percent, compared with 4.2 percent. It also lifted the tax on the richest people in the country.
The next item lawmakers plan to address is the spending cuts that will go into place on March 1 is an agreement is not made. All of this is expected to weigh heavy on businesses' decision to bring on new workers.