Today’s ADP jobs report didn’t just beat expectation; it crushed them.
According to the firm’s estimate, U.S. private companies added a whopping 281,000 jobs in June, which blew away expectations for a 205,000 gain.
“The breakdown looks good too with small firms of less than 49 employees adding 117K to the count, but increasingly, large companies of over 1,000 employees are hiring, those CEOs always down visiting with the President in Washington, they are starting to hire as well adding 32K to the 281K,” noted Bank of Tokyo-Mitsubishi’s Chris Rupkey. ” The economy looks good when large firms, always slow to make changes when the wind starts to shift, begin to hire.”
This comes a day after we learned the pace of U.S. auto unexpectedly accelerated to 16.9 million in June from 16.7 million in May. Analysts were looking for a pace of 16.4 million.
Also on Tuesday, we learned that weekly retail chain store sales grew at its fastest pace since December 2011.
“It is more and more difficult for the bears to find indicators that don’t show an acceleration in growth,” said Deutsche Bank’s Torsten Slok commenting on chain store sales. “I think we are getting closer to the non-linear inflection point when fixed income markets suddenly will realise that the recovery is real.”
“The economy has big momentum going for it now as uncertainty over the outlook diminishes,” said Rupkey. “Slack in the labour markets is rapidly receding and the economy is stepping it up a notch. GDP growth may not be what it was hoped to be, but it doesn’t matter because businesses are not holding back.”