Wednesday, September 05, 2007

August private sector job growth lowest in 4 yrs

Aug private sector job growth lowest in 4 yrs

NEW YORK (Reuters) - Private employers likely added 38,000 jobs in August, far fewer than analysts had expected and the slowest rate of growth in four years, a report by a private employment service said on Wednesday.

The report also revised July's private sector job growth downward to 41,000 from the originally reported 48,000 jobs. The employment report was developed jointly by ADP and Macroeconomic Advisers LLC.

Economists polled by Reuters had forecast 83,000 new jobs for August. The 38,000 result was the smallest increase since June 2003 and could reinforce market expectations for an interest rate cut by the Federal Reserve.

U.S. stock index futures extended their losses on the report. U.S. government bonds, which are usually boosted by soft economic data, extended their gains.

The ADP result followed a separate survey by Challenger, Gray & Christmas Inc. that showed planned U.S. lay-offs rocketed in August. The housing slowdown and subprime mortgage debacle led to record job cuts in the financial sector, the independent group said. Markets were awaiting the government's monthly employment report for August scheduled on Friday.