The private sector added 77,000 jobs in February while annual pay increased by 4.7% year-over-year, according to the latest ADP National Employment Report released in collaboration with the Stanford Digital Economy Lab. The report, based on payroll data from over 25 million U.S. employees, offers a high-frequency measure of employment trends in the private sector.
The February report indicates a slowdown in hiring, marking the smallest job gain since July. “Policy uncertainty and a slowdown in consumer spending might have led to layoffs or a slowdown in hiring last month,” said Nela Richardson, chief economist at ADP. “Our data, combined with other recent indicators, suggests a hiring hesitancy among employers as they assess the economic climate ahead.”
The job gains in February were led by the goods-producing sector, which added 42,000 positions. Within this category, the construction industry saw the highest increase, adding 26,000 jobs, followed by manufacturing with 18,000 jobs. The natural resources and mining sector, however, reported a loss of 2,000 jobs.
Service-providing industries added 36,000 jobs, with strong gains in leisure and hospitality (+41,000), financial activities (+26,000), and professional and business services (+27,000). However, declines were recorded in trade, transportation, and utilities (-33,000), information (-14,000), and education and health services (-28,000).
Regionally, employment gains were concentrated in the Northeast (+55,000) and Midwest (+56,000). The South (-12,000) and West (-27,000) saw declines, with the South Atlantic (-26,000) and Pacific (-25,000) regions reporting significant job losses.
Small businesses saw a net decline of 12,000 jobs, with firms employing 1-19 workers shedding 17,000 jobs. Medium-sized businesses (50-499 employees) added 46,000 jobs, and large businesses (500+ employees) contributed 37,000 jobs to the overall increase.
Annual pay growth remained stable in February, with job-stayers seeing a median pay increase of 4.7%. For job-changers, year-over-year pay gains slightly decreased from 6.8% in January to 6.7% in February.
By industry, the highest pay gains for job-stayers were in financial activities (5.1%), manufacturing (4.8%), and construction (4.9%). Small firms with fewer than 20 employees reported the lowest median pay growth at 2.8%, while large firms with 500 or more employees saw a 5.0% increase.
The January total for job additions was revised upward from 183,000 to 186,000, reflecting slight adjustments to previously reported data.
This article, “ADP National Employment Report: Private Sector Adds 77,000 Jobs in February” was first published on Small Business Trends