- Private U.S. employers added fewer jobs than expected in March as employers became more cautious over concerns about slowing economic growth.
- ADP’s National Employment Report showed private sector employment was up by 145,000, down from February and below economists’ forecasts.
- Nela Richardson, chief economist at ADP, said the report is “one of several signals that the economy is slowing.”
U.S. businesses added fewer jobs than expected last month as employers became more cautious because of concerns about slowing economic growth.
Hiring in the services sector, which has led the labor market comeback after the COVID-19 slump, slowed considerably. Just 75,000 new jobs were created, 115,000 fewer than the month before. Leisure and hospitality led the gains (+98,000); followed by trade, transportation, and utilities (+56,000); education and health services (+17,000); and other services (+8,000). Jobs were lost in financial activities (-51,000); professional and business services (-46,000); and information (-7,000).
In the goods producing sector, businesses increased employment by 70,000, with advances in construction (+53,000), as well as natural resources and mining (+47,000). Hiring decreased in manufacturing (-30,000).
Slowing Pay Growth
ADP noted that wage growth decelerated for those who stayed at their jobs and those who changed jobs. Annual hikes for job stayers rose to 6.9% in March from 7.2% in February. Job changers had a 14.2% rise versus 14.4% the month before.
Nela Richardson, chief economist at ADP, said the report is “one of several signals that the economy is slowing.” She explained that employers “are pulling back” from a year when they boosted hiring and offered higher compensation. She pointed out that increases in pay are inching downward after a three-month plateau.
The Labor Department is set to release the March nonfarm payroll report on Friday. Estimates are that the economy posted a gain of 240,000 jobs.