U.S. Private-Sector Hiring Eases More Than Expected as Large Firms Begin to Shed Jobs

By Joshua Kirby

Hiring among U.S. private-sector employees cooled much more than expected in September as the labor market continued to loosen, though wage growth stayed steady.

Employment in the nonfarm private sector increased by 89,000 jobs, compared with 180,000 in August, according to data from the ADP National Employment Report released Wednesday. This was the slowest pace of growth since January 2021, the ADP said. Economists polled by The Wall Street Journal had expected an increase of 160,000 jobs.

August's figure was revised up slightly from a previous estimate of 177,000.

"We are seeing a steepening decline in jobs this month," said Nela Richardson, chief economist at the ADP.

Annual wage growth meanwhile stood at 5.9% in September, the same level as in August and marking a straight year of no acceleration in wage growth, according to the ADP survey. Pay data is based on the salaries of almost 10 million individual employees over a 12-month period.

Large employers shed jobs in September, driving the slowdown in overall growth and wiping out gains made the previous month. Jobs were lost in the manufacturing, and trade, transportation and utilities sectors, as well as in professional and business services. Conversely, the leisure and hospitality sector added 92,000 jobs over the month, while the construction and financial industries were among the other sectors that added most positions.

By region, the West and especially the Pacific area added most jobs, while the South was the only region to shed jobs overall.

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. The ADP series can diverge considerably from the Labor Department's data.

Write to Joshua Kirby at [e-mail]; @joshualeokirby

(END) Dow Jones Newswires

October 04, 2023 08:57 ET (12:57 GMT)

Copyright (c) 2023 Dow Jones & Company, Inc.