ADP Employment Report Shows Fewer Jobs Created

The private sector added fewer jobs than expected last month, following an upwardly revised increase in the previous period, according to a national employment report from payroll giant Automatic Data Processing Inc. (NASDAQ: ADP).

The ADP report showed Thursday that 55,000 private-sector jobs were added in May, falling short of the economist estimate of an increase of 75,000. The report also showed an upwardly revised jobs increase in April of 65,000, from a previous report of 32,000 in the month.

The report showed large businesses or those with more than 500 workers, added only 3,000 workers in May, while medium sized companies increased payrolls by 39,000 employees in May.

Small businesses with 50 or less workers increased payrolls by 13,000.

Service-sector jobs increased by 78,000 workers last month according the report, while factories increased payrolls by 15,000 employees.

APD says that it processes one out of every six payments to employees in the U.S.

The report from the ADP tallies only jobs in the private sector, while the nonfarm payroll report will be released by the Bureau of Labor Statistics on Friday, which includes government workers.

The hiring of workers to conduct the 2010 census is expected to skew the data in May upward, as economists are expecting the BLS to report that nonfarm payrolls increased in the month by 515,000, following a jump of 290,000 in April.

The unemployment rate in May is expected to dip to 9.7 percent from an April reading of 9.9 percent.

In a separate report on Thursday, the Labor Department said that its weekly jobless report claims fell by 10,000 to 453,000 in the week ended May 29. Economists had expected a drop of 5,000. The previous week’s report was revised upward to 463,000 from 460,000.