Positive payrolls give the stock market some breathing room.

Close on the heels of a Nasdaq Comp sell off of 2%, the markets welcome a positive payroll number from ADP of 42,000 jobs added in October, breaking the decline of the past two months.

A welcome relief as employment doesn’t fall:  In a sign that we haven't completely fallen off a cliff, US employers added personnel, stabilizing a softening job market. 

Private-sector payroll gain of 42,000 beat estimates of 30,000.

[caption id="attachment_6127" align="alignnone" width="643"] ADP_Payrolls_By_Month[/caption]

With the government shutdown there are no reports from the Bureau of Labor Statistics, and the ADP report based on about 25Mn employees provides a welcome snapshot in a dark world.

According to Bloomberg reporting on the ADP report:

"Hiring was modest relative to what we reported earlier this year,” Nela Richardson, chief economist at ADP, said in a statement. Richardson is a contributor to Bloomberg Television. “Meanwhile, pay growth has been largely flat for more than a year, indicating that shifts in supply and demand are balanced.”

Wages remained flat, but we'll take a 42,000 gain as good news, as the recent layoff announcements from behemoths such as Amazon.com Inc., Starbucks Corp. IBM, and Target Corp, have done little to improve the deteriorating jobs landscape. The fear of losing lower level tech jobs due AI have also fueled anxiety amongst the younger generation, who are increasingly reliant of the gig economy to make ends meet.  While jobless claims are still generally subdued, a weak jobs market could drive up unemployment in coming months.

The Fed remains optimistic, though but, even after lowering interest rates last week for a second straight meeting, it makes no promises for further cuts.

Who added? Education, health, trade, transportation and utilities. Who dropped?  Business services, information and leisure and hospitality.

Large companies accounted for the increase in payrolls, while employment at small businesses declined for the fifth time in the last six months.

According to ADP in collaboration with the Stanford Digital Economy Lab, 

Wage growth stagnated. Workers who changed jobs saw a 6.7% increase in pay, while those who stayed put saw a 4.5% gain. ADP bases its findings on payrolls covering more than 26 million US private-sector employees.

ADP will now also release payroll data on a weekly basis in addition to the monthly reports.