KEY DATA:  ADP: +742,000; Manufacturing: +55,000/ ISM (NonManufacturing): -1 point; Orders: -4 points; Employment: +1.6 points

IN A NUTSHELL: “The Friday jobs report should be another really big one.”

WHAT IT MEANS:  Firms, especially those in the hospitality sector, may be complaining that they cannot find workers, but hiring is not going to slow down anytime soon.  That should become clear on Friday, if ADP’s big private sector April estimate of job gains holds any water – and I think it does.  Private sector job gains should be robust, with increases across the board, both in terms of sectors and firm size.  Yes, leisure and hospitality are bringing back workers rapidly, but what was amazing to see is that manufacturing may be adding workers at the strongest pace in decades.  That is happening despite the shortage of computer chips.  The surge in home building is driving up construction payrolls and health care is hiring like crazy as well.  Basically, the job market is on fire.

We saw on Monday that the manufacturing sector is booming along and today the numbers indicate that the services component of the economy may be expanding even faster.  The Institute for Supply Management’s NonManufacturing index eased in April, but the level is still near the record high set in March.  Demand may be only booming instead of skyrocketing, but hiring is accelerating.  With backlogs rising and inventories shrinking, payrolls will have to increase even faster if firms are to meet their growing needs.  As we saw in the ISM manufacturing survey, input costs are jumping in the services and construction segment of the economy as well.  Nearly sixty percent of the respondents reported that the prices they pay for goods went up.  Those cost increases may get passed along if demand remains robust.     IMPLICATIONS:Almost every state has either fully reopened or announced when they would do so.  Over the next few months, most people who want a job should have a chance to get one.  The only thing that would limit the increase in payrolls is the that the government is paying more to be on the unemployment rolls than the private sector is paying to work at their businesses.  The choice is clear, at least until the enhanced benefits run out.  Nevertheless, employment should growth massively well into the summer and that would generate large gains in wages and salaries.  So, look for retail sales to be robust into the fall, as people celebrate the return to some measure of normalcy.  We are already seeing that as April vehicle sales increased sharply. As for investors, their exuberance should be sustained.  Second quarter growth could match or even exceed the robust 6.4% pace posted in the first quarter, meaning earnings should be strong as well.  And the government will continue pumping money into the economy.  While some sectors and individual stocks may be priced quite high, there appears to be no economic reason for a major pull back in the general market.  But don’t be surprised if there are some price adjustments, as this market has been out of control for a while now.