Employment in the private sector rose in June at the highest rate in nearly two years, according to the ADP National Employment Report issued Wednesday for the month of June. By ADP's calculation, private sector employment rose by 281,000 new jobs created, surpassing most already optimistic projections.
The increase represents a gain of 102,000 private sector jobs over May's 179,000 job increase, signaling that employers are accelerating their hiring as demand continues to increase. The report, which is derived from ADP's actual payroll data, measures the change in total nonfarm private employment each month on a seasonally-adjusted basis.
Mark Zandi, chief economist of Moody's Analytics, said, "The job market is steadily improving. Job gains are broad based across all industries and company sizes. Judging from the job market, the economic recovery remains fully intact and is gaining momentum."
Of particular note to the housing industry, construction payrolls added 36,000 new jobs. Professional businesses services saw the greatest increase, clocking in at a 77,000 job gain.
"The June jobs number is a welcome boost," said Carlos Rodriguez, president and chief executive officer of ADP. "The number of construction jobs added was particularly encouraging, representing the highest total in that industry since February of 2006."
The report could be a good omen for the Obama Administration as it seeks to reassure the American public that the economy is not in danger of giving back recent gains after a lackluster first quarter of 2014. The government issued jobs report from the Bureau of Labor Statistics, encompassing both the public and private sector job rolls, is due out Thursday.
The median economist job growth prediction for June, in the Bloomberg monthly survey, forecasts a growth of 205,000 new jobs. Economists also predict that the unemployment rate will hold steady at 6.3 percent. If these numbers hold, it will be a signal to investors and consumers alike that economic fears that discourage spending and investment are unfounded at this point in time.