The pace of job creation by private employers in the US picked up in February, reinforcing hopes that a broader payrolls report released on Friday could confirm that labour market recovery has moved into a higher gear.
The private sector added 216,000 jobs last month, the ADP National Employment Report showed today, topping economists' expectations for a gain of 208,000.
The ADP figures come ahead of the government's more comprehensive labour market report on Friday, which includes both public and private sector employment.
"This does suggest we are moving in the right direction," said Beth Ann Bovino, senior US economist at Standard & Poor's Ratings Services in New York.
"It supports the expectations of another 200,000-plus in Friday's payroll report. The jobs numbers are looking healthier."
Economists are expecting Friday's report to show a gain of 210,000 in nonfarm payrolls, with the private sector adding 225,000 jobs and government payrolls declining modestly.
Economists often refer to the ADP report to fine-tune their expectations for the payrolls numbers, though it is not always accurate in predicting the outcome.
"Historically, the first prints of the ADP report have not been very reliable indicators of the first prints of the BLS (government) data and the average magnitude of the difference between these figures has been about 60,000 over the past 12 months," Daniel Silver, an economist at JPMorgan, wrote in a note.
"That said, the February ADP data have come pretty close to the BLS data during the past few years, missing by only 2,000 in 2010 and 5,000 in 2011."
ADP's January figures were revised up to an increase of 173,000 from 170,000. The report is jointly developed with Macroeconomic Advisers LLC.
US Treasuries prices eased on the data, while stocks opened slightly higher a day after Wall Street suffered its worst selloff in three months.
Reuters
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