Employers in the private sector added 742,000 jobs in April, according to payroll giant ADP, marking robust hiring growth as the economy bounces back despite the pandemic.
Small businesses added 235,000 jobs, including 122,000 at businesses with between one and 19 employees, and 113,000 at companies with between 20 and 49 employees, according to the ADP National Employment Report. Midsized businesses with between 50 and 499 employees gained 230,000 jobs in April. Large businesses added 277,000 jobs, including 84,000 at companies with between 500 and 999 employees, and 193,000 at corporations with 1,000 employees or more.
The economy has been rebounding this year as more businesses reopen and encounter labor shortages in industries that had to lay off millions of workers early last year. The service-providing sector accounted for the majority of the jobs added in April, gaining 636,000 jobs, including 104,000 in professional and business services such as accounting and tax preparation, 11,000 in financial activities like banking, and 237,000 in leisure and hospitality. The goods-producing sector added 106,000 jobs, including 55,000 in manufacturing and 41,000 in construction. Franchise businesses added 49,600 jobs.
April’s net gain of 742,000 private sector jobs was the strongest monthly increase since September, according to ADP chief economist Nela Richardson, but the private sector is still more than 8 million jobs short of pre-COVID-19 levels. “But the gap is starting to close more quickly,” she said during a conference call with reporters Wednesday. “Job gains have totaled 1.2 million over the last two months after adding only about 1 million jobs in the five months prior. For the second month in a row, it’s hiring by service sector providers that are the standout for payrolls in our report.”
The 636,000 service jobs is the strongest bounce since the initial reopening in May and June of last year, she noted. “Nearly 10 million jobs have been recouped thus far,” said Richardson. “That’s the good news, but service providers are still down by another seven and a half million from their pre-pandemic peak.”
She expects to see the strongest gains this year in the service sector, especially in the leisure and hospitality sector as restaurants return to normal operations in many parts of the country. About three and a half million jobs remain unrecovered in that sector, with travel and tourism still lagging because of the pandemic. “An untold number of businesses in the industry have failed over the last year,” said Richardson. She expects a similar recovery in the retail trade sector as more stores reopen.
The 104,000 jobs added in April in the professional and business services sector is the strongest growth in nearly a year. “The details are encouraging,” said Richardson. “Most of the acceleration in the hiring over the last two months has come from relatively low-paying administrative and support service segments, accounting for nearly three quarters of all industry jobs recovered thus far. This is due to the recovery of many office support roles as companies continue to evaluate back-to-office