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Today, a sign the American economy is waking up from its stupor. It’s possible your paycheck has the letters ADP printed on it. That gives the ADP company, which processes the paychecks of tens of millions of Americans, unique access to how many people are hired on in a month or how many people leave. A while back, the company started tracking this statistic, and today, ADP recorded the biggest surge it has ever seen in the number of new names added to its payrolls: 325,000.
“Ginormous” was the word used by the Wall Street Journal.
The November revised number showed 204,000 people added to ADP payrolls. That month-to-month gain was the largest jump in the three decades ADP has tracked the data. Many economists had been expecting something more in the 178,000 range, so today’s number was a big surprise.
Of course, there’s a caveat that ADP payroll numbers can be a little inflated in December. That’s the month when workers who left companies over the course of the year are finally purged from the payroll system. Still, the folks who watch this number and who had factored in seasonality were surprised.
Joel Prakken is Senior Managing Director of Macroeconomic Advisors, which helps ADP on the jobs index. He says today’s number gives hope that the economy is finally picking up the pace of its recovery.
Of course, Prakken says, there’s more to be done. The U.S. economy needs to get 6 or 7 million people back to work to get back to full employment. To do that, we’ll need many more months of huge gains like this one. Prakken says the pace is faster than glacial but still not fast enough.
We’ll know more tomorrow at 8:30 a.m. ET when the Bureau of Labor Statistics releases their monthly unemployment numbers. There’s usually a high level of correlation between the ADP report and the BLS report, so here’s to hoping tomorrow’s numbers are as good as today’s.
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