Private sector job creation continued to slow in November and wages posted their slowest increase in more than two years, payroll company ADP reported Wednesday.
Companies added just 103,000 workers this month, slightly less than the downwardly revised 106,000 in October and missing the Dow Jones estimate of 128,000.
The modest job growth was accompanied by a 5.6% increase in annual wages, the smallest gain since September 2021, according to ADP. Job switchers saw pay increases of 8.3%, putting the premium for changing positions at its lowest level since ADP began collecting data three years ago.
After leading job creation for most of the time since the Covid outbreak in early 2020, the leisure and hospitality sector recorded a loss of 7,000 jobs this month. The trade, transportation and utilities sectors recorded an increase of 55,000 jobs, while education and healthcare added 44,000 jobs and other services added 15,000 jobs.
Service-related industries accounted for all of the employment gains this month, as goods producers posted a net loss of 14,000 due to declines of 15,000 in manufacturing and 4,000 in construction, despite the settlement of the United Auto Workers strikes. Recent layoffs in Silicon Valley and Wall Street also didn’t show up in the data, as both sectors posted gains over the month.
“Restaurants and hotels were the biggest job creators during the post-pandemic recovery,” said ADP Chief Economist Nela Richardson. “But that recovery is behind us, and the return to trend in leisure and hospitality suggests that the economy as a whole will see more moderate hiring and wage growth in 2024.”
Companies with 50 to 499 employees led job creation, with an increase of 68,000. Small businesses contributed just 6,000.
The ADP report comes two days before the Labor Department’s widely watched nonfarm payrolls report. The two reports can vary widely, although private payroll numbers were close in October, as the Labor Department reported an increase of 99,000, just 7,000 below the revised ADP figure.
Including public sector jobs, nonfarm payrolls rose by 150,000 in October and are expected to grow by 190,000 in November, according to Dow Jones.
Another sign that the labor market is easing came Tuesday when the Labor Department reported that job openings fell to 8.73 million in October, the lowest level since March 2021.
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Correction: Annual wages rose 5.6%, the smallest increase since September 2021, according to ADP. The month was incorrect in a previous version. The Labor Department reported private payroll growth of 99,000 in October, just 7,000 fewer than the revised ADP figure. A previous version misstated a number.
Source : www.cnbc.com