Companies in the U.S. added fewer workers in November than a month earlier after superstorm Sandy battered the East Coast and temporarily shuttered some businesses.
The 118,000 increase in employment followed a revised 157,000 gain in October that was less than initially estimated, data from the Roseland, New Jersey-based ADP Research Institute showed today. The median forecast of 38 economists surveyed by Bloomberg projected a 125,000 rise in November. The report estimated that Sandy reduced payrolls by about 86,000.
Hiring plans were put off by companies in the mid-Atlantic, a three-state region that employs about 14 percent of U.S. workers, as they recovered from Sandy. Firms are also awaiting a solution by lawmakers in Washington to avoid automatic tax increases and budget cuts that raise the risk of recession in 2013.
“The manufacturing, retailing, leisure and hospitality, and temporary help industries were hit particularly hard by the storm,” Mark Zandi, chief economist at Moody’s Analytics Inc., said in a statement. Moody’s produces the figures with ADP.
Aside from Sandy, “the job market turned in a good performance during the month,” Zandi said. “This is especially impressive given the uncertainty created by the presidential election and the fast-approaching fiscal cliff.”
Stocks gains after the figures, with the Standard & Poor’s 500 Index rising 0.1 percent to 1,407.73 at 9:51 a.m. in New York.
Estimates in the Bloomberg survey ranged from 35,000 to 174,000. ADP initially estimated a 158,000 gain in October payrolls.
Goods-producing industries, which include manufacturers and construction companies, added 4,000 workers, today’s ADP figures showed. Construction employment increased by 23,000, while factory employment declined by 16,000.
Service providers added 114,000 workers.
Companies employing more than 499 workers increased payrolls by about 66,000 jobs. Medium-sized businesses, with 50 to 499 employees, added 33,000, and small companies took on 19,000, ADP said.
“Outside of Sandy, I think businesses are still hiring,” said Gus Faucher, a senior economist at PNC Financial Services Group Inc. in Pittsburgh. “There’s underlying job growth that’s strong enough to employ new entrants into the labor force as well as some of those who lost their jobs going into the recession.”