• According to the ADP National Employment Report, the private sector added 117,000 jobs in February.

• PNC expects job growth of 200,000 in February when the BLS releases the monthly employment report on Friday.

• Job growth will pick up in the spring and be very strong throughout 2021 and in to 2022.

According to the ADP National Employment Report, based on data from the payroll-processing firm, the private sector added 117,000 jobs in February. This was down from a gain of 195,000 jobs in January (revised up from 174,000).

Goods-producing industries lost a net 14,000 jobs in February, including a decline of 14,000 in manufacturing. Private services-providing industries added 131,000 jobs over the month, led by a gain of 48,000 in trade/transportation/utilities and 32,000 in health care/social assistance. Employment in leisure/hospitality services was up 26,000 as businesses began to reopen following closures related to rising coronavirus cases in late 2020 and early 2021.

Small firms (fewer than 50 employees) added 32,000 jobs in February, while medium-sized firms (50-499 employees) added 57,000 jobs over the month. The largest firms added 28,000 jobs.

The Bureau of Labor Statistics releases the government’s official jobs report on Friday. PNC expects moderate job growth of 200,000 over the month, as states have relaxed restrictions on economic activity as coronavirus cases have started to decline. PNC expects a modest increase in the unemployment rate to 6.4% in February from 6.3% in January as some previously laid-off workers start looking for jobs again.

After job losses of 22 million in March and April last year, the U.S. economy has added back about 12 million of those jobs. However, after an initial surge in hiring in the late spring and summer, job growth has slowed to a trickle. In the three months through January, the U.S. economy has added just 29,000 jobs per month on average. And PNC’s spring 2020 small business survey reported the weakest near-term hiring intentions in the history of the survey.

But job growth will pick back up again over the next few months, and remain very strong through the rest of 2021. Falling coronavirus cases, fiscal stimulus from the federal government, vaccine distribution, and very low interest rates will support strong job growth in the second half of 2021 and into 2022. PNC expects employment to return to its pre-recession level in the second half of 2022. The unemployment rate, which peaked at almost 15% in April 2020, will end 2021 at around 5% and 2022 at just above 4%, not too far above the 3.5% pre-recession rate. 

The PNC Financial Services Group, Inc. is one of the largest diversified financial services institutions in the United States, organized around its customers and communities for strong relationships and local delivery of retail and business banking including a full range of lending products; specialized services for corporations and government entities, including corporate banking, real estate finance and asset-based lending; wealth management and asset management. For information about PNC, visit www.pnc.com.