According to a Wednesday report by ADP, private sector job growth exceeded expectations in March, alleviating concerns over a potential slowdown in the labor market and economy.
The report indicates that employers added 155,000 workers during the month, a significant jump from the revised figure of 84,000 in February. This increase also surpassed the Dow Jones consensus forecast of 120,000, suggesting a resilient labor market.
This positive development comes amid rising concerns that President Donald Trump’s aggressive tariff policies could hinder hiring, thereby affecting overall business and consumer activity. Trump is scheduled to unveil the next phase of his trade strategy at 4 p.m. ET on Wednesday.
“Despite ongoing policy uncertainty and a dip in consumer confidence, the March numbers reflect strong performance for the economy and employers across various scales, if not uniformly across all sectors,” noted ADP chief economist Nela Richardson.
The hiring expansion was notably broad, with professional and business services contributing 57,000 new positions. Financial services added 38,000 jobs as the tax season intensifies, while manufacturing increased by 21,000 and leisure and hospitality gained 17,000 roles.
Service sector jobs comprised the majority, accounting for 132,000 positions. Conversely, the trade, transportation, and utilities sector experienced a decline, shedding 6,000 jobs, and natural resources and mining fell by 3,000.
On the wage front, earnings grew by 4.6% year-over-year for employees retaining their positions, with job switchers seeing even greater growth of 6.5%. This gap matches a series low last observed in September, indicating reduced mobility for workers seeking to change jobs.
Despite these challenges, the overall data points to a robust labor market. Bureau of Labor Statistics figures reveal that the ratio of job openings to available workers has improved, aligning almost evenly after previous years of an abundance of openings compared to the unemployed.
ADP’s report is released in anticipation of the more comprehensive Bureau of Labor Statistics assessment of nonfarm payrolls. Expected to show payroll growth of 140,000 in March, this report, which includes government jobs unlike the ADP assessment, reflects slightly lower growth compared to February’s figure of 151,000. The differing methodologies of the two reports often result in significant discrepancies in their findings.
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