U.S. Hiring Slows Beyond Expectations, ADP Reports
By Ed Frankl
U.S. private-sector jobs growth slacked significantly in July, with pay growth touching a three-year low, a signal to the Federal Reserve of a cooling economy and easing inflation, a monthly report said.
Private-sector employment rose by 122,000 jobs in July, down from a revised rise of 155,000 in June, according to the ADP National Employment Report published Wednesday, marking a fourth month of slowdown in a row.
It also was well below expectations of an increase of 150,000, according to a Wall Street Journal poll of economists.
Pay growth for job-stayers was 4.8% in July, the slowest pace of growth for three years, ADP said. Job-changers also saw pay gains tumble, to 7.2% from 7.7% in June.
"With wage growth abating, the labor market is playing along with the Federal Reserve's effort to slow inflation," said Nela Richardson, chief economist at ADP.
"If inflation goes back up, it won't be because of labor," she added.
Jobs continued to grow steadily in the services and construction sector, but declined in manufacturing, the data said. By region, the South added the most, followed by the West, Northeast and Midwest.
The ADP jobs estimate is based on aggregated payroll data of more than 25 million U.S. workers and is independent from Labor Department official data. Pay data is based on the salaries of almost 10 million individual employees over a 12-month period.
Labor Department employment data for July will be published Friday, with economists also expecting jobs growth to slow, but the unemployment rate to remain stable.
Write to Ed Frankl at edward.frankl@wsj.com
(END) Dow Jones Newswires
July 31, 2024 08:58 ET (12:58 GMT)
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