ADP February 2024 Job Report

ADP February 2024 Job Report

There were employment gains in several sectors, particularly in leisure and hospitality with 41,000 jobs and construction with 28,000 job gains. Other sectors with solid increases included trade, transport and utilities (24,000), finance (17,000) and the “other services” category (14,000).

Of these, 110,000 were in the service sector and 30,000 in goods production. Growth was concentrated in larger companies, as businesses with fewer than 50 employees contributed just 13,000 to the total growth.

Along with job growth, annual wages for those who keep their jobs also rose 5.1%, the smallest increase since August 2021, according to ADP, a possible sign that inflation pressures are easing.

The report comes as the labor market pays increased attention to signals about whether U.S. economic growth will stall this year after gross domestic product posted a solid 2.5 percent annual gain in 2023.

“Employment growth remains solid. Wage growth tends to be lower, but still above inflation,” said ADP chief economist Nela Richardson. “In short, the labor market is dynamic, but it will not determine a Fed rate decision this year.”

The ADP report precedes the Labor Department's official release of nonfarm payrolls on Friday. In recent months, the ADP has consistently underperformed the closely watched Bureau of Labor Statistics report, which recorded an increase of 353,000 in January, more than three times the ADP estimate.

Economists polled by Dow Jones expect a rise of 198,000 in Friday's report.