Economy Watch: Jobs, GDP Still Expanding

Automated Data Processing and the Federal Reserve Bank recently released reports indicating strong economic growth is continuing in the U.S.
Source: ADP National Employment Report March 2017
Source: ADP National Employment Report, March 2017

Private-sector employment increased by 263,000 positions in February, ADP reported on Wednesday, ahead of the official employment numbers from the federal government at the end of this week. While ADP’s figures often don’t agree with the official ones, they usually point out the direction job growth is taking. In this case, that points to strong growth in an expanding economy.

According to ADP, the service sector—which tends to use the most office space— grew by 181,000 jobs in February, including 25,000 in financial services and 57,000 in professional and business services. Construction employment was up by 49,000 for the month.

Separately, and as another indication of strong economic growth, the staff of the Federal Reserve Bank of Atlanta, in its GDPNow model forecast for real GDP growth, has upped its prediction for the economy during the first quarter of 2017 on Tuesday. Now the model suggests that the first quarter will have experienced 1.2 percent growth, up from a previous estimate of 0.9 percent.

The forecast of the contribution of net exports to first-quarter real GDP growth increased from -0.17 percentage points to -0.12 percentage points, after the international trade release from the Census Bureau. The forecast of the contribution of inventory investment to first-quarter growth declined from -0.76 percentage points to -0.80 percentage points after the bureau’s latest manufacturing report was released.