By Timothy R. Homan -- March 3 (Bloomberg) -- U.S. companies in February cut the fewest jobs in two years, according to data from a private report based on payrolls.
The 20,000 decline was in line with forecasts and followed a revised 60,000 drop the prior month, data from ADP Employer Services showed today. Over the previous six months, ADP’s initial figures have overstated the Labor Department’s first estimate of private payroll losses by as little as 10,000 in January to as much as 151,000 in November.
Companies are hesitant to add workers until they see sustained gains in sales as the U.S. emerges from the worst recession since the 1930s. Economists surveyed by Bloomberg News anticipate the government’s report March 5 will show U.S. payrolls declined by 50,000, in part because snowstorms in parts the country caused some businesses to close.
“This report really is pretty encouraging,” Joel Prakken, chairman of Macroeconomic Advisers LLC. in St. Louis, said in a press conference. He said job gains should come in the next month or two. Macroeconomic Advisers produces the report with ADP.
The ADP figures were forecast to show a decline of 20,000 jobs, according to the median estimate of 31 economists surveyed by Bloomberg. Projections ranged from a loss of 150,000 to a 25,000 gain.
Weather’s Influence
Most economists agree the severe winter storms in February will probably depress the Labor Department’s payroll figures.
“In the ADP data, weather doesn’t matter much at all,” said Prakken. “If you remain on the ADP computerized log, you’re counted as employed.” The Labor Department’s figures are based on whether an employee worked during the week that incl
