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Business/Finance See other Business/Finance Articles Title: Where the Jobs Are … and Aren’t Where the Jobs Are … and Aren’t Mike Larson | Wednesday, November 4, 2015 at 4:22 pm Where can jobs be found in this country? Which industries are doing better and which are doing worse? The ADP Research Institute tries to answer those questions for us the first Wednesday of every month. Then the Labor Department weighs in two days later. So what did ADP say in its October report today? ==> Overall employment grew by 182,000 last month. That was the weakest reading since July, and a deceleration from September’s downwardly revised 190,000k figure. It also confirmed we’ve downshifted from the kind of 200,000+ numbers we saw throughout 2014. ==> Manufacturing continued to struggle, with another 2,000 jobs lost on the heels of last month’s 17,000-worker drop. The service sector came in stronger. But the rate of job gains there dropped to 158,000 from 182,000 in September. Financial sector growth weakened notably, as did job gains in professional and business services. ==> Small businesses continue to add positions at a healthy clip. Those with 49 or fewer employees added 90,000 jobs. But large companies with at least 500 workers on their payrolls added only 29,000 jobs. That was a sharp deceleration from 101,000 in September. Are more people destined for the unemployment lines? So if I had to sum up the message here, it’s that the U.S. economy is starting to bend. The burden of a slower world economy and a weak energy sector, among other threats, is causing job growth to decelerate. Large manufacturers and other multinational companies are getting hit the hardest. But as layoffs mount here at home, their struggles will likely spill over into more domestically focused industries and businesses, too. The slowdown in service sector growth may be the first sign of that. Will it “matter” to the markets? Well, the negative economic news of late certainly didn’t derail the October rally in the S&P 500 or the Nasdaq-100, or the gains in the first couple days of November. But I can’t help but note the economically sensitive Dow Transports remain depressed, and that many of the divergences I’ve highlighted persist. So maybe the answer is that it matters to SOME stocks, many bonds and several commodities. You can profit in select stocks that have strong, company-specific stories attached to them – as we’ve seen in technology. You can profit in less economically sensitive names that offer yield protection, solid ratings, and corporate catalysts. Two names that foot the bill in my Safe Money Report just moved nicely higher. But broad, unhedged bets on the market? In an environment where bear market trading behavior can increasingly be found in many corners of the financial world? That’s a bridge too far for me here, despite the rally over the past few weeks. So what do you think of the latest labor data? Is the relative strength in services and small business hiring enough of a positive to offset the weakness in larger, multinational industries? Do you agree or disagree with my market stance, and do you think these jobs figures support my view or undercut it? Make sure you head over to the Money and Markets website and weigh in when you get a minute. Post Comment Private Reply Ignore Thread
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