Advertisement
Advertisement

ADP Reports Moderate Job Growth, Pay Increase in November

By:
James Hyerczyk

U.S. private sector added 103,000 jobs in November, falling short of the 131,000 job market expectation.

ADP Employment

Highlights

  • U.S. Adds 103,000 Jobs, Below Expectations
  • Pay Growth Slows, Regional Job Disparities Emerge
  • Medium Firms Drive Majority of Job Growth

Moderate Job Growth and Pay Increases in the U.S. Private Sector

In November 2023, the U.S. private sector experienced moderate job growth, adding 103,000 new positions, as reported by the ADP National Employment Report™. This figure, though positive, was below market expectations of 131,000 jobs, indicating a slight slowdown in the employment rate. The report, a collaboration between the ADP Research Institute® and the Stanford Digital Economy Lab, also noted a significant 5.6% year-over-year increase in annual pay, marking a continuing trend in wage growth.

Sectoral and Regional Job Distribution

The job gains were uneven across sectors and regions. The service-providing sector led with 117,000 new jobs, primarily in trade/transportation/utilities and education/health services. However, there was a notable decline in leisure/hospitality and professional/business services. In contrast, the goods-producing sector saw a reduction of 14,000 jobs, impacted by losses in manufacturing and construction, though natural resources/mining showed a slight increase.

Geographically, the Northeast and South regions showed significant job additions, with notable growth in the Middle Atlantic and West South Central subregions. The Midwest and West, however, experienced minimal growth or slight declines, indicating regional disparities in job market trends.

Job-stayers witnessed a 5.6% increase in pay, the slowest since September 2021, while job-changers saw an 8.3% gain, the smallest year-over-year rise since June 2021. This slowing pace of pay increases suggests a cooling labor market. In the goods-producing sector, construction workers received the highest pay increase, while in the service-providing sector, leisure/hospitality and education/health services saw the most significant wage growth.

Establishment Size and its Impact on Employment

The data also revealed variances based on establishment size. Medium-sized establishments (50-249 employees) contributed the most to job growth, while small and large establishments showed modest increases. This trend reflects the differing capacities of businesses of various sizes to navigate the current economic landscape.

Short-term Forecast: Cautious Optimism

The current job market trends, characterized by moderate job growth and a steady increase in wages, point towards cautious optimism. While the lower-than-expected job additions and the slowing wage growth indicate a tempering labor market, the overall increase in employment and pay suggests underlying resilience. The market will closely watch for potential shifts in employment patterns and wage trends in the coming months, especially considering the regional and sectoral disparities.

About the Author

James is a Florida-based technical analyst, market researcher, educator and trader with 35+ years of experience. He is an expert in the area of patterns, price and time analysis as it applies to futures, Forex, and stocks.

Did you find this article useful?

Advertisement