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Us Companies Axe 371,000 Jobs In July

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American businesses cut 371,000 jobs from their workforces in July in a further sign that recovery in the labour market remains far off despite positive signs in other areas of the economy.

The latest figures from Automatic Data Processing (ADP), the payroll services company, show that US companies cut fewer jobs in July than in any month since October 2008, but the data was higher than analysts expected.

Despite recent indications that overall economic activity is stabilising, ADP forecasts that employment, which usually trails overall recovery, is likely to decline for at least several more months, albeit at a diminishing rate.

The survey, based on responses from 400,000 US private sector businesses employment around 23 million people, found that large businesses, employing 500 or more workers, cut 74,000 jobs.

Medium-sized companies, with 50 to 499 employees, lost 159,000 jobs and small companies cut payrolls by 138,000, according to the report, produced jointly by ADP and Macroeconomic Advisers.

The biggest fall was in the services sector, which lost 202,000 jobs. A fall of 99,000 in manufacturing was the smallest monthly decline since September 2008.

The Labor Department’s payrolls report, due on Friday, which includes public sector jobs, may show employers cut another 275,000 to 328,000 jobs in July.

This is less than the 467,000 reported in June, which took the unemployment rate to 9.6 per cent

We are losing jobs slower, the recession is over and the recovery has begun.

I wonder how many job losses have been delayed due to govt stimulus? I wonder what will happen once the intervention ends.....

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Wall Street’s recent eye-popping gains came even as more Americans lost their jobs and languished on unemployment rolls. But on Wednesday, worries about the labor market caught up with Wall Street.

Stocks hovered lower in afternoon trading, but had climbed back from their morning lows, on concerns that employers were still cutting jobs, a move that could pose additional threats to household finances, consumer spending and families’ abilities to make ends meet.

A report from Automatic Data Processing and Macroeconomic Advisors found that employers cut 371,000 private-sector jobs in July on a seasonally adjusted basis, after a revised decline of 463,000 jobs in June. Although it was the smallest number of monthly job losses since October, more jobs are likely to disappear as businesses focus on cutting costs instead of expanding.

The private ADP report focuses attention on the labor market in the United States, where unemployment has risen to 9.5 percent and more than 6 million jobs have been lost since the start of the recession in December 2007. The government will report first-time jobless claims on Thursday, and will release its monthly assessment of the labor market on Friday.

Economists expect that the report will show that the country lost 328,000 jobs in July after a loss of 476,000 jobs in June.

At 3:45 p.m., the Dow Jones industrial average was down 37 points, or 0.4 percent, while the broader Standard & Poor’s 500-stock index was off 0.2 percent. Losses in technology stocks like Intel and Oracle pulled the Nasdaq down 0.86 percent.

More job losses to come then.

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These numbers are from ADP and only try to predict the private sector changes in the BLS NFP report due on Friday.

Job losses in the private sector may be slowing down. Given what is happening at the state and local level in the US, it is quite possible that the public sector is shrinking despite the stimulus.

Until NFP gains are 200k per month for three consecutive months, the US consumer is not out of the woods. This still looks like it is a long way away.

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