We’re entering a critical window of reporting as it pertains to our economy. After record job loss during the shutdowns, we experienced two consecutive months of job gains as phased reopenings took hold throughout the country. Then there was the summer surge in COVID cases. Along with them came renewed restrictions ranging from California to South Florida. Notably, the three largest states in the country, California, Texas, and Florida were the three hardest hit by new coronavirus cases in July. So, what about the economy? What about jobs? The ADP private-sector jobs report is the first view of what happened in July. The news isn’t great, but it also isn’t bad. Right now, we’ll take anything positive and that’s what we received.
According to the ADP Report, there were 167,000 private-sector jobs added in July. That included:
- Small businesses: +63,000
- Midsized: -25,000
- Large: +129,000
There’s a clear dichotomy in these numbers. We continue to see the largest businesses benefit the most from the pandemic, and thus hire the most. The job gains for large companies were significant for any month but especially given what we faced in July. The same clearly wasn’t true for those caught in the middle. The news overall, represented by small businesses was highly encouraging, however. Small businesses are the tip of the economic spear. Small companies are the most economically sensitive and are the first to react with changes in payrolls based on demand. That we saw an increase of 63,000 is encouraging. It also paints a picture in which people are buying most of their stuff from the big companies while prioritizing small businesses for other purchases. As for the breakout based on industries:
- #1 Professional & Business Services
- #2 Education & Health
- #3 Trade, transportation & Utilities
On another positive note, there were 10,000 manufacturing jobs added. That’s also encouraging. On Friday we’ll get the full picture with government jobs added in.
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