Originally posted on April 1, 2010.

A disappointing ADP jobs report shows that 23,000 private sector jobs were lost in March. This data was shocking to some forecasters who predicted that economic recovery was on the way. The Washington Post claimed that the construction industry and factories fared the worst in the ADP report,

Big losers in the ADP report were the construction industry, which lost 43,000 jobs in March, and factories, which shed 9,000 jobs.

Since the ADP report only measures private sector employment, some view it as a more accurate representation of joblessness. Some economists are already claiming that Friday’s much-anticipated release of the government’s jobs report by the Labor Department will be inflated due to the hundreds of thousands workers temporary hired for the 2010 census. According to Bloomberg news,

Economists surveyed by Bloomberg News anticipate the government’s report April 2 will show payrolls increased by 184,000, in part due to temporary hiring by the federal government to conduct the 2010 census.

In a rare glimpse of good news in the labor market, the number of workers filing new claims for jobless benefits decreased more than expected last week,

The Labor Department said in its weekly report Thursday that initial claims for jobless benefits declined by 6,000 to 439,000 in the week ended March 27. The previous week’s level was revised upward to 445,000 from 442,000.

However, this jobless claim decrease may be due to the government hires for the census. While this may be temporary beneficial for the census worker, it will not lead to any economic recovery since their pay is funded through taxpayers and the deficit. In addition, the initial claims for jobless benefits is still too high to create any lasting job creation,

economists say that lasting job creation cannot occur until the new weekly jobless-claims number remains in the low 400,000s or goes lower.

Many businesses are reluctant to hire new employees since they are uncertain how recently passed and proposed legislation will affect them. The newly passed health care insurance reform legislation decreases tax deductions for any business with drug coverage for their retired employees. As a result, some companies have already taken an unexpected hit,

Last week, telecommunications giant AT&T, which employs more than 280,000 people, announced it would take a $1 billion, non-cash, first-quarter loss because the bill ends an exemption on benefits for retirees.

Likewise, the largest maker of earth-moving equipment, Caterpillar, claims it will take a $100 million charge. Deere & Company, the world’s largest producer of agriculture equipment, will take a $150 million charge. 3M, maker of Scotch Tape and other products, says it will take a hit of as much as $90 million.

The ADP monthly report should be regarded as a clear picture of US joblessness. While the census will employ over 100,000 workers, we have yet to see sustainable employment growth within the private sector. The employment of these census workers will not increase the overall economic pie since taxpayers are paying for their salaries. Private sector growth is the key to economic recovery. Legislation that places increased taxes and regulations on businesses only impedes economic growth by forcing employers within the private sector to shed jobs.