U.S. Hiring Slows Again at Start of Year, ADP Reports
By Joshua Kirby
Hiring among U.S. private-sector employers slowed in January, and wage growth continued to ease as inflation cools.
Employment in the nonfarm private sector rose by 107,000 jobs, slowing from a revised 158,000, according to data from the ADP National Employment Report set out Wednesday. Economists polled by The Wall Street Journal had expected a shallower slowdown to 150,000 new jobs.
Wages meanwhile increased by an average 5.2%, continuing recent months' easing. "Pressure on wages continues to ease and the pay premium for job-switchers shrank to a new low last month," the report said.
Despite the slowdown in wage growth, real pay is improving for U.S. workers as inflation falls, said Nela Richardson, chief economist at ADP. "Progress on inflation has brightened the economic picture despite a slowdown in hiring and pay," she said.
"Wages adjusted for inflation have improved over the past six months, and the economy looks like it's headed toward a soft landing in the U.S. and globally," Richardson said.
Consumer prices picked up pace in December, according to data set out earlier this month by the Labor Department, though economists expect a reversion to lower inflation over the coming months.
In January, gains in the service sectors were around half those of the previous month, though these sectors still led growth, adding 77,000 jobs in areas like hospitality, healthcare and education. Goods-producing sectors added around 30,000 jobs, largely in construction.
By region, the South saw the largest increase in jobs, adding 57,000 positions, most of them in the South Atlantic area. The West added the fewest, with just 2,000 new jobs in the Mountain region and none in the Pacific area.
Pay data is based on the salaries of almost 10 million individual employees over a 12-month period. The ADP estimate is based on aggregated payroll data of more than 25 million U.S. workers and is independent from U.S. Labor Department official data.
Write to Joshua Kirby at joshua.kirby@wsj.com; @joshualeokirby
(END) Dow Jones Newswires
January 31, 2024 08:53 ET (13:53 GMT)
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