August’s US ADP Private Employment report showed a lower-than-expected gain of 177k jobs, falling short of the consensus forecast of 205k. The data, which is often viewed as a precursor to the official non-farm payrolls report, painted a nuanced picture of the American labor market.
By sector, goods-producing sectors added 23k jobs, while service-providing sectors accounted for 154k new positions. By establishment size, small companies added 18k jobs, medium-sized companies contributed 79k, and large companies rounded out the additions with 83k.
Compounding the modest employment gains was a noticeable slowdown in wage growth. For those staying in their current roles, the year-over-year pay increase was 5.9%, marking the weakest growth since October 2021. Meanwhile, job changers experienced a deceleration in pay growth to 9.5%.
Nela Richardson, chief economist at ADP, provided context for these numbers. “This month’s figures are consistent with the pace of job creation before the pandemic,” she said. “After two years of exceptional gains tied to the recovery, we’re moving toward more sustainable growth in pay and employment as the economic effects of the pandemic recede.”
