Judging from the news today, Friday’s job report from the Bureau of Labor Statistics (BLS) will likely be one that rattles the markets.
The preliminary from ADP today showed a decrease of 126,000 jobs in goods-producing industries including manufacturers and construction companies. Service providers cut 31,000 workers. Employment in construction fell by 45,000.
That made the total job loss a staggering 157,000 for the month of October.
That’s worrisome because throughout the downturn, the ADP report has consistently pointed to fewer job losses than the BLS figures, by about 100,000 jobs or more for almost a year.
That means the BLS figures released on Friday morning could shatter the headlines with a job loss of 250,000 for October.
Here’s the skinny on the ADP report.
From Bloomberg by Bob Willis entitled: ADP Says U.S. Companies Reduced Payrolls by 157,000
“Companies in the U.S. cut an estimated 157,000 jobs in October, the most in almost six years, a private report based on payroll data showed today.
The drop was larger than forecast and followed a revised 26,000 decrease in September that was bigger than previously estimated, ADP Employer Services said. The decline in employment was the biggest since November 2002, when the U.S. was emerging from a recession.
Firings have spread from automakers, financial and housing- related companies to retailers and other services as the economic slump deepened. A government report in two days may show the economy lost jobs in October for a 10th consecutive month, according to a Bloomberg News survey of economists.
The ADP report was forecast to show a decline of 102,000 jobs, after an originally reported drop of 8,000 in September, according to the median estimate of 28 economists in a Bloomberg News survey
“We are starting to see more recession-like declines in employment,” said Sal Guatieri, a senior economist at BMO Capital Markets in Toronto. “The loss of jobs means consumers will continue to retrench in the next couple of quarters.”
For the year some 750,000 jobs have been lost. Meanwhile, Friday’s report could push that number to over a million.