The fastest job growth in April came in leisure and hospitality with a gain of 154,000, followed by education and health services (69,000) and construction (53,000).
The financial sector lost 28,000 jobs for the month. Manufacturing also took a hit, losing 38,000 jobs.
Hiring at private companies unexpectedly swelled in April, countering expectations for a cooling job market ahead, payroll processing firm ADP reported Wednesday.
Private payrolls rose by 296,000 for the month, above the downwardly revised 142,000 the previous month and well ahead of the Dow Jones estimate for 133,000. The gain was the highest monthly increase since July 2022.
The surge comes despite Federal Reserve efforts to slow economic growth and in particular to tame a powerful labor market that has added more than 800,000 jobs this year by ADP’s count. An imbalance of demand over supply in the labor market has created strong wage gains that are reflected in persistent inflation pressures.
One positive sign for the Fed is that annual pay rose 6.7% over the past year, a deceleration from gains that had been consistently coming in above 7%.
“The slowdown in pay growth gives the clearest signal of what’s going on in the labor market right now,” Nela Richardson, ADP’s chief economist, said. “Employers are hiring aggressively while holding pay gains in check as workers come off the sidelines.”
The firm’s report serves as a precursor to the Labor Department’s more closely watched nonfarm payrolls count due out Friday. Economists surveyed by Dow Jones expect that data to show an increase of 180,000 following March’s 236,000. The two reports often differ, sometimes by large margins.
According to ADP, the fastest job growth in April came in leisure and hospitality with a gain of 154,000, followed by education and health services (69,000), and construction (53,000). Other sectors posting solid increases included natural resources and mining, with 52,000, and trade, transportation and utilities, which added 32,000.
The financial sector, beset by deposit runs that have led to the closure of three mid-sized banks, lost 28,000 jobs for the month. Manufacturing also took a hit, down 38,000 jobs, as the sector has been in contraction for the past six months.
Job gains were fairly evenly distributed across company size, with firms employing fewer than 500 employees contributing 243,000 to the total.
Source: CNBC
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