U.S. Private Sector Job Growth Slows More Than Expected In January

(RTTNews) - Private sector employment in the U.S. rose by less than expected in the month of January, according to a report released by payroll processor ADP on Wednesday.

ADP said private sector employment increased by 213,000 jobs in January following an upwardly revised increase of 253,000 jobs in December.

Economists had expected employment to climb by about 223,000 jobs compared to the addition of 241,000 jobs originally reported for the previous month.

Mark Zandi, chief economist of Moody's Analytics, said, "Employment posted another solid gain in January, although the pace of growth is slower than in recent months."

"Businesses in the energy and supplying industries are already scaling back payrolls in reaction to the collapse in oil prices, while industries benefiting from the lower prices have been slower to increase their hiring," he added.

The report said employment in the service-providing sector rose by 183,000 jobs in January compared to the addition of 207,000 jobs in December.

The professional/business services industry contributed 42,000 jobs in January, reflecting a large drop-off from December's 72,000 jobs.

Job growth in the goods-producing sector also slowed, as the sector added 31,000 jobs in January after a jump of 47,000 jobs in December. The manufacturing and construction industries both saw slower job growth.

ADP also said small and large business saw slower job growth, while medium-sized businesses was the only segment showing an increase.

The weaker than expected private sector job growth may raise some concerns about Friday's employment report from the Labor Department, which includes both public and private sector jobs.

Economists currently expect the Labor Department report to show an increase of about 230,000 jobs in January following the addition of 252,000 jobs in December.