Report: Private sector job market sluggish in May

The ADP report comes just two days before the Labor Department is scheduled to announce its May employment figures, after announcing last month that the economy had added 244,000 jobs in April. (The private sector added 268,000 on its own, while the unemployment rate stood at 9 percent.)

The weaker-than-expected ADP numbers could force some forecasters to readjust their thinking in advance of the Labor Department release. According to Reuters, Credit Suisse now sees the private and public sector combining to add 120,000 jobs last month, instead of 185,000. 

{mosads}Other estimates have overall payrolls adding 180,000 jobs last month.

All that said, Wednesday’s release was not a total surprise to some, coming on the heels of a disappointing 1.8 percent growth in gross domestic product in this year’s first quarter. 

“This is below most economists’ estimate of the economy’s potential growth rate and normally would be associated with very weak growth of employment,” Joel Prakken of Macroeconomic Advisers, a partner in the ADP report, said in a statement. 

According to ADP, the U.S. service sector added 48,000 jobs in May, giving it 17 consecutive months of growth. But the goods-producing and manufacturing sectors both shed jobs, after, respectively, six and seven straight months of gains.