WASHINGTON -- U.S. private businesses added the most jobs in more than two years last month, a private survey found, a third-straight month of robust gains.
Payroll processor ADP LLC said Wednesday that businesses added 263,000 jobs in March, the most since December 2014. That is up from 245,000 in February, which was revised lower.
The figure is much higher than economists' forecasts for the government's jobs report, to be released Friday. Analysts predict that report will show 178,000 jobs were added, according to data provider FactSet.
The healthy gain follows solid increases in January and February and suggests that rising business confidence is translating into stronger hiring. Small-business optimism soared after the November presidential election and is near a record high. Widespread improvement in the global economy has also bolstered larger firms' outlook.
"Job growth is off to a strong start in 2017," said Mark Zandi, chief economist at Moody's Analytics, which assists ADP in preparing its report.
"The gains are broad-based but most notable in the goods producing side of the economy including construction, manufacturing and mining," he said.
Stocks weakened over the past two days after car companies reported a drop in sales in March, with some wondering if that meant consumers were growing reluctant to spend money. Katie Nixon, chief investment officer for Wealth Management at Northern Trust, said the ADP survey suggests that won't happen: Even though the economy has been growing for about eight years, employers are still hiring a lot of workers.
"It suggests that the cycle can indeed go on much longer than many had feared," she said. "We continue to see pretty good strength in the employment market."
The ADP data indicates that hiring remains strong even though growth appeared to slow in the January-March quarter. Many economists estimate that the economy grew at roughly a 1 percent annual rate in the first three months of the year. That would be half the 2.1 percent pace in last year's fourth quarter.
The ADP report "is clearly another indication that, despite the apparent slowdown in GDP growth in the first quarter, labor market conditions have remained unusually strong," said Andrew Hunter, U.S. economist at Capital Economics, a forecasting firm.
Small and medium-size businesses posted the biggest increases. Small companies with fewer than 50 employees added 118,000 jobs, while medium-size firms added 100,000.
The job gains were led by big increases in construction, manufacturing, and professional and business services, which includes high-paying fields such as accounting and engineering.
Construction companies added 49,000 jobs, a third-straight month of robust gains that partly reflects the unseasonably warm winter experienced by much of the country. Yet homebuilders are also stepping up construction in response to heavy demand for homes.
Businesses that serve consumers also added a healthy number of positions, a sign that companies are seeing stronger demand.
A category that includes retailers and shippers added 34,000 jobs, while restaurants, hotels and amusement parks added 55,000 jobs.
The ADP survey covers only private businesses and often diverges from official figures. In February, ADP said employers added 298,000 jobs, much higher than the government's figure of 238,000.
Information for this article was contributed by Marley Jay of The Associated Press and by Jim Puzzanghera of the Los Angeles Times.
Business on 04/06/2017