ADP Report Shows US Added Nearly 2.4M Private-Sector Jobs in June

It’s not exactly “Happy Days Are Here Again,” but private sector employment increased by nearly 2.4 million jobs from May to June, according to the June ADP National Employment Report released Wednesday (July 1).

That’s in sharp contrast to an early May report from the same source, Automatic Data Processing (ADP) and Moody’s Analytics, showing massive job losses when the pandemic hit with full force. ADP’s report for April had private-sector companies in the United States losing 20.2 million jobs.

The massive job losses were tied to the pandemic and shelter-in-place orders and the associated storefront closings that swept much of the country.

Compared to that, things are really looking up now.

“Small-business hiring picked up in the month of June,” Ahu Yildirmaz, vice president and co-head of the ADP Research Institute, said in a press release. “As the economy slowly continues to recover, we are seeing a significant rebound in industries that once experienced the greatest job losses. In fact, 70 percent of the jobs added from May to June were in the leisure and hospitality, trade and construction industries.”

By company size, small businesses picked up 937,000 jobs. That covers companies ranging from one to 49 employees. In April, those businesses lost 6 million jobs.

In June, the smallest-size companies, with up to 19 employees, alone picked up 574,000 employees.

For their part, medium-sized businesses, with 50 to 499 employees, hired 559,000 employees.

Large businesses hired 873,000 employees. The largest businesses, those with over 1,000 employees, hired 772,000 workers.

The industry sectors of natural resources and mining lost 26,000 jobs. Another job-losing category was that covering management of companies/enterprises, which lost 29,000 jobs.

Back in April, the service industry was hardest hit, with 16 million jobs lost. More than half of that came from jobs lost at hotels and restaurants.

The ADP National Employment Report uses ADP payroll data, covering 460,000 U.S. clients employing nearly 26 million U.S workers.

Whether employers are adding workers on just hanging on to the ones they have, the pandemic has also raised the question of how to pay people when so many Americans are working from home.

Laura Valdespino, director of compliance solutions at ADP, told PYMNTS in a recent interview that companies with most or all staffers working from home have no one in the office to physically cut checks, let alone mail them out.

“How do you pay those checked employees when, traditionally, you would hand them a physical check at the end of the day?” she asked.

Even if someone does come in to do payroll, “employees don’t want to wait for the check, they don’t want to touch the check, they don’t want to physically go to the bank to cash the check,” Valdespino said. “And they really don’t want to touch the cash.”

As a result, ADP is seeing a growing interest from employers in compensating workers using digital-payment systems like pay cards. “Employers are stating that they want out of writing checks,” she said. “And they can show employees that: ‘I can safely pay you quickly — in some cases instantaneously.’”

To read more of Valdespino’s comments, click here.