ADP Reports June Payrolls Add 172K Jobs

June payrolls may indeed pop back to trend, based at least on ADP's private payroll estimate of 172,000 which is well above the Econoday consensus for 150,000. But ADP's sample never did pick up the weakness during May in the government data as the ADP call for the month stands nearly unchanged, at a revised 168,000 vs the initial estimate of 173,000 and one that compares with the government total of only 25,000. The bottom line here is that the ADP report, like other indications on the labor market including jobless claims, are continuing to signal healthy conditions.

Recent History Of This Indicator:
The ADP employment report, which had been a very good indicator for this year's employment reports, reverted back to false signals in May, estimating a 173,000 gain for private payrolls that turned out to be a dismal 38,000 and a game changer for FOMC policy makers who have since taken a near-term rate hike off the table. ADP's estimate for June is expected to come in at 150,000, significantly below expectations for underlying private payroll growth of 170,000.