Private employers added 158,000 jobs last month, payroll processor ADP said Wednesday. That’s down from February’s gain of 237,000 and January’s 177,000.
Construction companies didn’t add jobs in March, after average monthly gains of 29,000 in the previous three months.
Mark Zandi, the chief economist at Moody’s Analytics, said the hiring surge during the previous months likely reflected a jump in rebuilding after Superstorm Sandy. Moody’s helps compile the monthly report with ADP.
The ADP report is derived from actual payroll data and tracks total nonfarm private employment each month.
The report suggests that the government’s March payroll figures, to be issued Friday, might come in below economists’ forecast of 195,000 net jobs.
Zandi said the drop in job growth in March wasn’t significant and that the underlying trend in monthly hiring is roughly 175,000. That’s about where it’s been for two years. Zandi expects the government’s employment report will show hiring at that level in March.
“I don’t think anything substantively changed in the month of March,” he said.
Still, there are some signs that the health care reform law might be causing smaller companies to hold off on hiring, Zandi said. That law requires companies with 50 or more full-time workers to provide health insurance to their employees.
To make that point, Zandi pointed to mid-sized retailers, hotels, restaurants and service companies – all of which slowed hiring last month.
Other reports suggest that the job market is improving. The number of people seeking unemployment benefits rose last week but is still lower than in February. That means companies are cutting fewer jobs and might post higher net gains.
And a closely watched survey of manufacturing activity showed factories hired in March at the fastest pace in nine months.