The ADP Employment Report has been released. It was better than expected and improved from the previous month. October data was also revised for the better from +43,000 to +82,000.
Reuters Quick Recap....
RTRS -ADP NATIONAL EMPLOYMENT REPORT SHOWS U.S. EMPLOYMENT INCREASED BY 93,000 PRIVATE SECTOR JOBS IN NOVEMBER
RTRS -REUTERS CONSENSUS FORECAST FOR ADP PAYROLL CHANGE FOR NOV WAS FOR INCREASE OF 69,000 JOBS
RTRS -US ADP OCTOBER PAYROLL CHANGE REVISED TO +82,000 FROM +43,000
RTRS -ADP NOVEMBER PAYROLL INCREASE HIGHEST SINCE NOVEMBER 2007
RTRS -US private sector Nov job rise highest in 3 yrs-report
ROSELAND, N.J. – December 1, 2010 – Private-sector employment increased by 93,000 from October to November on a seasonally adjusted basis, according to the latest ADP National Employment Report® released today
According to the ADP Report, employment in the service-providing sector rose by 79,000 in November, the tenth consecutive monthly gain. Employment in the goods-producing sector rose by 14,000, the first monthly increase since March 2007. Construction employment dropped by 3,000 during November, the smallest decline since June 2007, and manufacturing employment increased by 16,000.
“Although most segments of the U.S. private sector have experienced some positive job growth recently, the unemployment rate has remained stagnant for around eighteen months,” said Gary C. Butler, President and Chief Executive Officer of ADP.
“Most businesses still have little reason to add to their payrolls due to the ongoing uncertainty in the economy. To support job creation, our nation’s policymakers should do their part to create an environment of reasonable economic certainty by clearly defining key tax and regulatory policies. Reduced economic uncertainty, along with appropriate near term incentives for businesses to invest and expand, will encourage businesses to hire.”
According to Joel Prakken, Chairman of Macroeconomic Advisers, LLC, “This month’s ADP National Employment Report shows an acceleration of employment and suggests the nation’s employment situation is brightening somewhat. November’s gain in private-sector employment is the largest in three years. This is the tenth consecutive month of gains, which have averaged 47,000 during that period. Nevertheless, employment gains of this magnitude are not sufficient to lower the unemployment rate, which likely will remain above 9% for all of 2011. Furthermore, given modest GDP growth in the second and third quarters, and the usual lag of employment behind GDP, it would not be surprising to see several more months of only moderate gains in employment even as the economic recovery gathers momentum.”
“Large businesses, defined as those with 500 or more workers, increased by 2,000 while employment among medium-size businesses, defined as those with between 50 and 499 workers, increased by 37,000. Employment among small-size businesses, defined as those with fewer than 50 workers, increased by 54,000,” said Prakken.
Plain and Simple: Good Stuff! Private industry added 93,000 jobs in November and October was revised better by 39,000. Inside the data, service providing industries expanded hiring for the 10th consecutive month while goods producing firms expanded hiring for the first time since....March 2007. If this doesn't scream "WE'RE REPLACING HUMAN BRAWN WITH TECHNOLOGY" then I don't know what does. Welcome to the age of efficiency and high productivity where American (Korean) made robots battle Chinese children for global manufacturing supremacy! American innovation is leaving the untrained (non-specialized) blue collar worker behind. 6.2 million Americans have been unemployed for 27 weeks or longer.....
Market Reaction...
All that buying we witnessed yesterday, in VERY high volume, was erased overnight. The yield curve is significantly steeper this morning and "rate sheet influential" MBS prices are once again retesting the outer limits of the recent range.
2s/10s are 8bps steeper at 241bps wide. The 10yr note is 14.1bps higher in yield, 10bps of that played out in the overnight session, 4 more bps were added after ADP. The FNCL 4.0 is -20/32 at 100-28, below key support at 101-00. Trading volume has been high into the downtrade. Traders report an increase in loan supply sales from originators.
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