ADP: August Employment Slows for 2nd Straight Month

In the second of four major jobs reports this week, ADP, Roseland, N.J., said private-sector employment rose by a modest 132,000 jobs in August, slowing for the second straight month, while annual pay increased by 7.6 percent.

The ADP National Employment Report found job growth fell by more than half from July, when private employers created nearly 270,000 jobs; payroll growth also slowed from a year ago.

By industry sector, goods-producing employers created 23,000 jobs, while the service sector created 110,000 jobs. By region, employers in the South created 76,000 jobs, followed by the West (40,000) and the Northeast (23,000). The Midwest saw negative job creation at -7,000.

By company size, small employers (1-49 employees) created 25,000 jobs; medium employers (50-499 employees) created 53,000 jobs and large employers created 54,000 jobs.

The report said year-over-year rise in annual pay was 7.6 percent in August, in line with monthly readings since spring. In early 2021, annual pay increases were running at about 2 percent. While the pace of pay increases is elevated, its growth has flattened.

“Data suggests a shift toward a more conservative pace of hiring, possibly as companies try to decipher the economy’s conflicting signals,” said Nela Richardson, chief economist with ADP. “We could be at an inflection point, from super-charged job gains to something more normal.”

The parade of employment reports continues on Thursday when the Labor Department releases its weekly Initial Claims for unemployment insurance report (8:30 a.m. ET).

On Friday, BLS issues its monthly Employment Situation report (8:30 a.m. ET) on August employment numbers. MBA NewsLink will cover the report in its Tuesday, Sept. 6 edition (no issue on Labor Day, Monday, Sept. 5), with commentary and analysis from MBA Chief Economist Mike Fratantoni.