It may seem like the market rallies on bad news and good news alike, and it often feels a bit like celebrating news that is just “less bad” than other recent reports. The ADP monthly national employment report is used as a barometer for each month’s Employment Situation report from the U.S. Department of Labor. This is definitely in the “much less-bad news” category.

ADP reported that the private sector payrolls lost 2.76 million jobs in the month of May. The Wall Street Journal’s consensus estimate was a loss of 8.75 million jobs. Econoday’s consensus estimate was 8.66 million jobs lost. The April total of jobs lost was revised from 20,236,000 to 19,557,000.

One issue to consider, similar to the Labor Department’s report, is that the data only includes about two weeks worth of data. ADP noted that the report’s data is only through May 12 and that it does not fully reflect the COVID-19 impact on the overall employment situation.

Small businesses lost 435,000 jobs in May, and midsized businesses lost 722,000. The big drop was from large employers losing just over 1.6 million positions. The goods-producing portion lost 794,000 jobs, and the services-proving sector lost 1.967 million jobs.

ADP continued to warn that the impact of the COVID-19 recession still weighs on all classifications and all sizes of businesses. That said, the good news on top of the significantly lower losses is that ADP now states that the total job losses likely peaked in April. That also was when many states started phased reopening of businesses.

The sample used to create this monthly report comes directly from ADP payroll data. That is shown to represent 460,000 U.S. businesses that employ nearly 26 million workers in the United States.

Again, the ADP report is used as a barometer for the direction of the Labor Department’s private sector payrolls figures. The monthly read-throughs have not been good for pegging exact numbers. These are the Econoday consensus estimates coming out this Friday:

• Nonfarm payrolls, −7.725 million (versus −20.5 million in April)
• Private sector payrolls, −6.5 million (−19.52 million in April)
• Unemployment, 19.8% (14.7% in April)
• Participation rate, 60.0% (60.2% in April)
• Hourly earnings, 0.9% (4.7% in April)
• Average workweek, 34.3 hours (34.2 hours in April)

Stocks were already trading higher on Wednesday morning due to less violence, but the Dow Jones industrial average was last seen up 255 points at 25,997 and the S&P 500 was up 26 points at 3,106.85.

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