The GDP for the first quarter of 2019 was impressive, delivering an annualized rate growth of 3.2%. To go along with that great number, in April the U.S. economy added 275,000 jobs. This has driven the unemployment rate down to 3.6%, the lowest in 50 years (December, 1969).
For its part, the small business segment added 77,000 jobs this month. This is up by a considerable margin from the 6,000 jobs created in March.
April 2019 ADP Small Business Report
Overall, owners are optimistic about the economy in the coming year despite some of the challenges attributed to the talent shortage. The low unemployment rate is making it much harder for small businesses to find the talent they need.
In the press release for April’s ADP report, Mark Zandi, chief economist of Moody’s Analytics, said, “The job market is holding firm, as businesses work hard to fill open positions.”
Good Jobs and Higher Wages
Wall Street was expecting 190,000 in April, so the 275K exceeded even the most optimistic forecast. Not only was the number high, but quality jobs were being filled.
Professional and businesses led the job gains with 76K. This was followed by health care and social assistance (53K), leisure and hospitality (34K), and construction (33K).
When it comes to wages, the growth is holding steady at 3.2%. This increased the average hourly rate by 6 cents to $27.70 per hour.
Overall Employment Numbers
The year started with a bang, delivering a whopping 312,000 jobs in January 2019. February took a huge dip at 56K, followed by March with 189K jobs.
The 275K in April brings the average for the year to 205,000. This is slightly lower than the 223,000 average for the whole of 2018, but it is early days in 2019.
According to ADP, small businesses with 1-19 employees created 32K jobs, while those with 20-49 added 45K more jobs. In April the goods-producing sector created 24K jobs and service-producing sector added 53K more.
Medium-sized businesses with 50-499 employees added the largest number of jobs with 145K, and large businesses contributed 53K more.
April 2019 ADP National Franchise Report
Franchises added 5,500 more jobs in April compared to March with a total of 9,500 jobs.
The restaurant and real estate sectors and industry had positive numbers with 14,200 and 100 jobs respectively. The rest of the sectors, food retailers, accommodations, auto parts and dealers and business services were all negative.
This is great in terms of increasing the purchasing power of people. More jobs mean more purchasing power.