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Private sector job creation slowed a touch in August, missing expectations though roughly maintaining the pace of expansion so far in 2014.
A report from ADP and Moody’s Analytics showed employment growth of 204,000 positions, off a touch from the downwardly revised 212,000 in July and well off the 297,000 in June. Economists surveyed by Reuters had expected the report to show 220,000 new positions.
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One highlight of the report was manufacturing, which gained 23,000, the best for that sector since December 2012.
Job creation was strongest in the service sector, which added 164,000, well off the 190,000 level from the previous month. Professional services added 51,000, which was 9,000 less than July, while trade, transportation and utilities contributed 28,000, off from the 43,000 in July.
Goods producers added 41,000, which was better than the 23,000 in July, and construction hired 15,000, a slight improvement.
Small business (fewer than 50 workers) set the pace in terms of size, adding 78,000, while medium-sized businesses contributed 75,000 and large firms hired 52,000.
“Every industry is adding to payrolls. Jobs in every company size are increasing,” Moody’s economist Mark Zandi told CNBC. “The small businesses are most tied into the housing and construction cycle more broadly. Since the turn in the housing market…that has really resulted in a lot more jobs in smaller businesses.”
The data sets the stage for Friday’s nonfarm payrolls report, which is expected to show 204,000 new jobs.
“A gain in employment of just more than 200,000 in August is consistent with the low level of initial jobless claims and the strength of the employment indices of the business surveys,” Paul Dales, senior US economist at Capital Economics, said in a note. “If anything, the recent strength of the activity surveys suggests that the risks lie to the upside.”
Dales has an above-consensus 225,000 target for the payrolls number.