ADP National Employment Report: Private Sector Employment Increased by 152,000 Jobs in May; Annual wages increased by 5.0%.
US Private Sector Employment and Wages Increase: ROSLAND, N.J., June 5, 2024 /PRNewswire/ – The May National Employment Report released by ADP Research in collaboration with the Stanford Digital Economics Lab showed a notable increase in employment and wages in the private sector in the United States. According to the report, the number of private sector jobs increased by 152,000 during May, indicating a strong improvement in the labor market.
In a sign of improved wages, the annual wage rose by 5.0 percent year on year, which enhances the financial stability of workers in the private sector. This rise in wages reflects enhanced economic growth and business confidence.
The ADP National Employment Report is a reliable, high-frequency source for tracking the private sector labor market in the United States. The report analyzes real-time, anonymized payroll data for more than 25 million U.S. employees, allowing analysts and decision-makers to get a comprehensive view of the state of the economy and labor market.
Frederick Monroe, CEO of ADP Research, commented on this increase, saying: “The increase in employment of 152,000 jobs during the month of May reflects a marked improvement in the US labor market. A sustained rise in wages indicates greater income stability and enhanced opportunities for economic prosperity for workers in the sector.” private”. In light of these positive developments, it is expected that the private sector labor market in the United States will continue to grow, enhancing confidence and optimism in the national economy. This report is a strong indicator of the recovery of the economy and a sustainable improvement in the labor market
The importance of the ADP National Employment Report
The importance of the ADP National Employment Report is its use of accurate, anonymized and aggregated salary data to provide a representative picture of the private sector labor market. The report uses weekly jobs data from the previous month and isolates the total change in private employment for the current month.
The basic ADP salary databases may be considered a reliable source and are updated on an ongoing basis. With this continuous updating, the report provides a high-frequency, near-real-time measure of U.S. employment. This metric reflects the number of employees on ADP clients’ payroll (payroll hiring), providing a richer understanding of the labor market. Additionally, ADP’s pay scale uniquely captures the earnings of a group of approximately 10 million employees over a 12-month period. These data reflect changes in wages and contribute to analyzing wage trends and financial stability for workers in the private sector.
With this accurate and comprehensive data, the ADP National Employment Report provides useful information for analysts and decision makers to assess the economic condition and trends in the US labor market. This information enhances confidence and optimism in the national economy and contributes to the development of employment strategies and human resource planning in companies and institutions. Nella Richardson, chief economist at ADP, announced that job gains and wage growth are expected to slow in the second half of the year. Although the labor market remains strong, there are signs of notable weakness in some sectors related to both producers and consumers.
These statements indicate the possibility of economic growth slowing in the coming period, which reflects the challenges faced by some industries and companies in light of the current economic conditions. This can be a result of multiple factors such as market volatility, economic uncertainty, effects of government policies, and global events.
The report is two days before the non-farm payrolls report
Almost all of the hiring came from the services sector, with goods producers contributing just 3,000 net to the total. Trade, transportation, and utilities topped the list with 55,000 new jobs, while education and health services added 46,000 jobs, and construction contributed 32,000 jobs. The other services category added 21,000, but leisure and hospitality, a major contributor over the past several years, saw an increase of only 12,000.
A number of sectors witnessed job losses during the month. The manufacturing sector, which has been in contraction for most of the past year and a half, lost 20,000 jobs. Other sectors that saw declines included natural resources and mining (-9,000), information (-7,000), and professional and business services (-6,000). Small businesses also saw a decline, with businesses employing 20 to 49 workers down by 36,000.
The report comes two days before the closely watched nonfarm payrolls report from the Bureau of Labor Statistics. ADP can sometimes provide a preview of what’s coming in a BLS report, although the two censuses can differ, sometimes dramatically. The ADP report showed that private payroll growth of 188,000 in April exceeded the BLS number of 167,000.
Wall Street economists expect nonfarm payrolls to expand by 190,000 in May after growing by 175,000 the previous month. However, a number of indicators have recently shown signs of slowing hiring, and a Bureau of Labor Statistics report on Tuesday showed job openings fell to just over 8 million in April
However, it should be noted that these statements reflect ADP’s expectations and analyzes based on currently available data, and circumstances and conditions may change in the future. Therefore, future expectations remain subject to change and require careful monitoring and analysis of economic and labor market trends. The US non-farm private sector added 184,000 jobs in March, exceeding analysts’ expectations of 148,000.
