ADP Automatic Data Processing Inc

This is Mark Vickery covering for Sheraz Mian, who is off today.

ADP's (ADP) numbers missed slightly this morning. The biggest private-sector check-cutter reported a gain of 91,000 jobs in August, down from an expected level of 100,000 jobs gained. The ADP is the premiere jobs report prior to this Friday's Bureau of Labor Statistics (BLS) non-farm payroll report, and this moderate miss may ding expectations for Friday's numbers.

Also, July's numbers were revised down from 114,000 new jobs originally reported to 109,000. So both headline numbers represent a disappointment, although with how expectations have often been crushed in recent months, the market may breathe a sigh of relief that the numbers weren't worse. In fact, stock futures were up immediately after the ADP report was announced.

The estimate for Friday's BLS report are now for a gain of 80,000 jobs in August. The main difference between the ADP and BLS reports is that the ADP does not count government jobs but the BLS does.

By size of firm, small businesses -- the biggest and most important private employers in the country -- gained 58,000 jobs during the month. Medium-sized businesses gained 30,000, and large businesses were up 3,000. Goods producing jobs were up 11,000, services were up 80,000 but manufacturing was down 4,000 jobs.

Any way you slice it, this marks further tepid jobs growth in the U.S. Not always do the ADP and BLS numbers correlate, but they usually exist within a range, particularly after revisions in later months modify the results. An additional 91,000 jobs will not do much to stave off fears of another recession, but they do at least provide grist for the mill that we are growing, albeit at an anemic pace.

Elsewhere, the Challenger Report, from firm Challenger, Gray & Christmas, reports job cuts falling (from 16-month highs) to 51,000-plus. CEO John Challenger said on CNBC's "Squawk Box" this morning that he sees the majority of job cuts remaining on the Government side, but switching from State & Local jobs to the Federal level. "Usually government is growing wildly after a recession, with new tax revenues. That's just not happening this time," Challenger said.
 
AUTOMATIC DATA (ADP): Free Stock Analysis Report
 
Zacks Investment Research