Buried by this morning’s unexpected GDP figures was the release of the payroll processing firm ADP’s latest estimates of private sector job growth. Those estimates were generally positive. The report found that 192,000 private sector jobs were gained in January, though the December numbers were revised down to 185,000 from 215,000. That’s not great — we’d still need another 8 years and 10 months to get back to pre-recession employment — but it’s a better pace than we had for much of last year.
Given that ADP is a better predictor of final unemployment numbers than the official BLS job numbers — albeit one with higher variance — that’s cause for optimism. Then again, because ADP focuses on private firms this won’t catch the contraction in federal defense spending that appears to be at the root of this month’s lousy GDP numbers. In any case, it’s a reminder that the private sector appears to be recovering even as the government holds the overall economic recovery back.