Private payroll growth fell sharply in January, a possible sign that the U.S. labor market is headed for a slowdown this year, ADP reported Wednesday.
According to the payroll company, companies hired 107,000 new workers in the first month of 2024, down from the downwardly revised 158,000 in December and below the Dow Jones estimate of 150,000.
Only one sector – information services (-9,000) – reported a decline, but hiring was slow in virtually all sectors.
The leisure and hospitality sector saw the largest increase with an increase of 28,000 workers, while trade, transport and utilities added 23,000 workers and construction saw an increase of 22,000. 77,000 jobs were in service companies, the rest in goods producers.
The release comes two days before the Labor Department’s nonfarm payrolls report, which is expected to show growth of 185,000, up from 216,000 in December. While ADP data can be a barometer for private sector hiring, the two reports often differ, with ADP often coming in below Labor Department numbers.
As for wage gains, ADP reported an annual increase of 5.2%, a figure above the government’s reported average hourly wage measure.
“Inflation-adjusted wages have improved over the past six months and the economy appears to be headed for a soft landing in the U.S. and globally,” said ADP Chief Economist Nela Richardson.
Medium-sized companies with 50 to 499 employees were the frontrunners in job creation with 61,000 jobs. Small businesses only added 25,000.
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2024-01-31 14:22:09
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