Friday's employment report will be a flop, based on ADP's estimate for private payrolls which it sees rising only 185,000.

This is below the lowest analyst estimate for 190,000. It is also 20% lower than the 232,000 number ADP posited a year ago, and the weakest July since 2013.

Payrolls for businesses with 49 or fewer employees increased by 59,000 jobs in July, half of the June number. Employment among companies with 50-499 employees increased by 62,000 jobs, down from 78,000 the previous month.

Employment gains at large companies – those with 500 or more employees – increased sharply from June, adding 64,000 jobs in July, up from 34,000. Companies with 500-999 added 17,000 jobs after adding 28,000 jobs in June. Companies with over 1,000 employees added 47,000 jobs, almost eight times the weak 6,000 added the previous month.

"July employment growth was slower than June, but is still in line with what we have seen since the first of the year,” said Carlos Rodriguez, president and chief executive officer of ADP. “Notably, large businesses with more than 500 employees had their strongest job gains since last December and were almost double the June number.”

Mark Zandi, chief economist of Moody’s Analytics, said, “Job growth is strong, but it has moderated since the beginning of the year. Layoffs in the energy industry and weaker job gains in manufacturing are behind the slowdown.”

Meanwhile,Gallup's U.S. Job Creation Index, a forward looking measure, maintained its high of plus 32 in July for the third month in a row. This score is based on 43% of workers saying their employer is hiring workers and expanding the size of its workforce.

It also includes 11% who say their employer is letting workers go and reducing the size of its workforce. Both of these are the same as in June.

After hitting a record low of minus 5 in early 2009, it remained negative or close to zero for the rest of that year. Gradually, the index improved, eventually reaching a high of plus 30 in September 2014. After hovering between plus 27 and plus 29 from October 2014 to March 2015, the index climbed two points in April and another point in May to reach the high that it has sustained over the last two months.


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