“Job gains remain solid,” ADP Chief Economist Nela Richardson said in a press release issued Wednesday in conjunction with an ADP National Employment Report Economy Lab report.
The report, which analyzes the payroll transactions of more than 25 million US workers, is produced by the ADP Research Institute in collaboration with the Stanford Digital Economy Lab.
The health/education sector added 11,000 jobs in February out of the total 140,000 jobs added in the private sector during the month. That’s a slight decrease from January, when the health/education sector added 17,000 jobs.
The data showed a service sector gain of 110,000 jobs last month. The biggest gains in this sector in February were seen in leisure / hospitality, which saw the addition of 41,000 jobs.
Regionally, the biggest gains in February occurred in the West, where 42,000 jobs were added. Private employers in the Midwest added 39,000, followed by the South, with 37,000 jobs added, and the Northeast, with 20,000 additional jobs.
Medium-sized firms (with 50 to 499 employees) gained the most jobs in February, with 69,000 jobs added. Large establishments (with 500 or more employees) gained 61,000 jobs, and small companies (with one to 49 employees) added 13,000 jobs.
Pay gains
“Pay gains are trending lower but are still above inflation,” Richardson said.
For job-changers, year-over-year pay gains were 7.6 %, higher than in January and the first month-over month increase for job-changers since November 2022, according to ADP.
Pay gains for job-stayers reached their lowest rate since August 2021 in February, at 5.1%.
Companies with one to 19 employees saw the smallest median change in annual pay, 4.4%. The change was 5.2% for firms with 20 to 49 employees, 5.4% for employers with 50 to 249 workers, 5.4% for companies with 250 to 499 employees, and 5.1% at firms with 500 or more workers.
“In short, the labor market is dynamic but doesn’t tip the scales in terms of a Fed rate decision this year,” Richardson said.
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