In July, the US private sector experienced a deceleration in employment growth, as reported by Automatic Data Processing (ADP). According to ADP's data, private employment grew by only 122,000 jobs, falling short of the anticipated rise of 150,000 jobs based on a survey conducted by Bloomberg. This follows a revision in June's job gains, which were adjusted upwards to 155,000 from an initial report of 150,000.
In terms of compensation, year-over-year pay increases for workers who remained in their positions have now slowed to 4.8%. Meanwhile, wage growth for individuals who switched jobs saw a decrease to 7.2%, down from the previously recorded 7.7% increase last month. Nela Richardson, Chief Economist at ADP, commented on the situation, stating, "With wage growth abating, the labor market is playing along with the Federal Reserve's effort to slow inflation.
If inflation goes back up, it won't be because of labor." The goods-producing sector contributed to the job market with an addition of 37,000 jobs in July. This increase was primarily fueled by a substantial jump in construction employment, which saw 39,000 new jobs, although this was partially counterbalanced by a reduction of 4,000 jobs in manufacturing.
On the other hand, service-related industries outperformed with a total of 85,000 new jobs added. Notably, trade, transportation, and utilities sectors saw significant contributions, adding 61,000 jobs, alongside leisure and hospitality, which added 24,000 jobs as per the ADP report. Small businesses faced challenges in July, losing a total of 7,000 jobs, whereas medium and larger enterprises showed positive trends with job gains of 70,000 and 62,000, respectively.
Additionally, recent government data revealed that US job openings and employee quits fell in the previous month. The Bureau of Labor Statistics is set to release a report on Friday projecting that the US economy added approximately 175,000 nonfarm jobs in July, indicating a downturn from the 206,000 job gain witnessed in June.
The stock performance for ADP reflects this context, with a current price of 266.91, showing a change of +9.17 or a percent change of +3.56..