US private payroll growth slows in August as manufacturing sheds jobs

WASHINGTON, Sept 2 (Reuters) - U.S. private ‌payrolls increased less ​than ​expected in August as strength in the education and health services sector was offset by job losses in manufacturing and a few other industries.

Private ‌employment rose by 38,000 jobs last month after an upwardly revised 46,000 ⁠in July, the ADP National Employment Report showed on Wednesday. Economists polled by Reuters had forecast private ‌employment would advance by 48,000 after ‌a previously reported rise of 44,000 in July.

Education and health services payrolls increased by 45,000 positions. The leisure and hospitality sector added 16,000 jobs, while financial activities ​payrolls rose by 6,000. The construction sector added 12,000 positions.

But manufacturing shed 17,000 jobs while the professional and business services sector lost 16,000 positions. There were job ⁠losses in the trade, transportation and utilities sector as well as information, natural resources and mining.

The ADP report is ​jointly developed with the Stanford Digital Economy Lab, and was published ahead of the Bureau of Labor Statistics' more comprehensive and closely ​watched employment report for August on Friday. ADP ‌has been a poor gauge of the BLS' private payrolls estimate.

The BLS reported on Tuesday that there were 1.05 open jobs for every ⁠unemployed person in July, little changed from June and consistent with stable labor market conditions. Though economists continue to view the labor market as remaining in a "slow-hire, slow-fire" state, momentum has slowed ⁠since the spring surge.

Private payrolls likely increased by 45,000 jobs in August after rising by 30,000 ​in July, according to a Reuters survey of economists. Nonfarm payrolls are expected to have rebounded by 56,000 jobs last month after a surprise decline of 23,000 in July. That rebound would partly reflect ‌a recovery in local government education payrolls.

"We would frame that healthier rise in employment in August, however, as partly making up for ‌acute weakness over the previous few months," said Oliver Allen, a senior U.S. economist at ⁠Pantheon Macroeconomics. "The bigger picture likely will ‌remain that the apparent upturn ​in employment growth in the spring already has faded."

The unemployment rate is forecast to be unchanged at 4.1%.

(Reporting by Lucia Mutikani; Editing by ‌Paul Simao)

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