Private sector employment continued to expand at a strong pace in September, with companies adding 143,000 jobs during the month, payroll processing firm ADP said Wednesday. The report indicated growth that was stronger than the upwardly revised total of 103,000 in August, and greater than the 128,000 jobs economists had projected, based on a Dow Jones survey.
However, wage growth still decelerated slow and still has room for improvement. For employees who did not change jobs, pay increases rose to 4.7%. Meanwhile, those who have changed jobs received pay increases at 6.6%, down by 0.7 percentage point from August.
Job growth was evenly spread across a wide variety of industries, although they were actually headed by leisure and hospitality, 34,000. Other ones with a little strength were construction with 26,000, education and health services with 24,000, professional and business services with 20,000, and another services with 17,000. Information services was the only industry to lose, 10,000 jobs lost.
The report said most of the increase in jobs came from companies with more than 50 employees, small firms recorded a net loss, especially among those firms with fewer than 20 employees, which fell by 13,000.
This ADP report comes ahead of the Labor Department’s nonfarm payrolls data, that will show a growth of 150,000 jobs after a pretty woeful August performance, with private sector hiring, adding 118,000 to the sum total of 142,000.
Federal Reserve officials are paying close attention to labor market data in their deliberations about future monetary policy. Fed Chairman Jerome Powell described the labor market as “solid” in a recent speech but acknowledged that it has “clearly cooled” over the past year. The Fed cut its interest rate a half-point last month, and is expected to cut again both November and December. The current futures market indicators did however indicate a quarter-point cut in November followed by a half-point reduction in December, though Powell himself hinted that in fact a series of consecutive quarter-point moves is more plausible and that it will depend on the upcoming economic data.
