US private employers demonstrated the highest rates of job growth in the past seven months. Data comes from ADP’s payroll processing firm. However, many experts are handling the data with skepticism.
Why? It’s because the current pandemic is still in effect, and the numbers may be skewed as a result.
Also, a few weeks are still required to understand the impacts of Omicron – the new strain of coronavirus – and how it’ll affect job rates.
Important Facts to Consider
Most of the growth comes from the transportation industry and service sectors.
There, private employment shot up by 807,000 between November and December, based on the National Employment Report from ADP.
This is positive, where the last report did call for around 370,000 new jobs. It’s also a new high from November’s rates, which were at 505,000.
This was seen as positive news, especially with the low November values. In fact, November job additions were almost half of what many job economists predicted the months before.
That still wasn’t the worst job month of the year – with September being the lowest.
Regardless, a statement from ADP implies that the December growth isn’t sector-restricted. Instead, it has affected the broad labor market.
Still, the company admits that the data comes in light of the pandemic’s delta-variant fading out. The impacts of the omicron strain are yet to be seen.
More on Omicron
Just a week after the report’s tracking period, omicron was announced as the dominant virus strain in the US.
The virus wave pushed daily cases from 36,000 on 12th December to over 1 million by early January.
Economic experts aren’t downplaying the virus effects either. In fact, many have outlined the difficulty of measuring omicron’s economic impact, and are cautioning against ignoring its effects on the labor market.
Thus far, it’s predicted that massive worker shortages might set in with continued concerns over the pandemic’s duration.
In fact, many experts see that the pandemic is the controlling factor of the economy. The delta wave has not only lowered growth rates, but it has negatively affected inflation rates too.
Economic damage doesn’t end there.
Credit card use has dropped throughout the past week. Many sports organizations are also suspending play, and the airline industry is canceling flights endlessly as pilots and personnel are screened for sickness.
Getting an Accurate Picture
For a better idea of how omicron is affecting the economy, we recommend waiting for the Labor Department’s jobs report.
The report will discuss the job market’s performance last December. Set to release by mid-January, it’ll add more detail as to how the broad market is shaping up.
However, the report isn’t expected to accurately portray the current omicron surge. Thus, a few weeks more are required before assessing the new strain’s impacts.