Business hiring slowed this month with the private sector adding just 130,000 net new jobs as the partial government shutdown hit an already weakening labor market, payroll processor ADP said Wednesday.
The figure was below the 150,000 average monthly job growth in the sector over the previous year as the hiring in the service sector fell off in October, said Mark Zandi, chief economist at Moody’s Analytics, which assists ADP in the monthly report.
“The government shutdown and debt limit brinkmanship hurt the already softening job market in October,” Zandi said. Firms that do government contracting were affected by the 16-day government shutdown and the fiscal impasse probably caused small companies to hold off on hiring, he said.
The 130,000 private-sector jobs added in October marked the smallest gain since April, ADP said. Economists had projected ADP’s numbers would show the private sector added 138,000 jobs last month.
Combined with a significant downward revision of September\’s figure to 145,000, the latest ADP data do not bode well for the government’s October job report, due next week, and add to the likelihood that the Federal Reserve will hold steady on its stimulus efforts, Zandi said.
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