U.S. ADP Payroll Gain Moderates in November; Wage Growth Increases
by:Tom Moeller
|in:Economy in Brief
Summary
- Employment increase led by hiring in services.
- Construction employment improves, while factory jobs decline.
- Wage gain for “job changers” strengthens.
The ADP National Employment Report indicated that nonfarm private sector payrolls rose 146,000 (1.4% y/y) during November after increasing 184,000 in October, revised from 233,000. These increases leave the 165,000 average so far in Q4 above its 124,000 average in Q3 but below this year’s high of 211,000 in March. A 165,000 November rise in ADP employment had been expected in the Action Economics Forecast Survey.
Growth in median annual pay for "job stayers" of 4.8% y/y in November is close to recent gains but remains the weakest since July 2021 and well below a September 2022 high of 7.8% y/y. Pay increases in education & health services were steady at 5.1% y/y, but were below a 7.2% high early in 2023. Construction sector earnings rose an improved 5.2% y/y. Manufacturing pay growth of 4.7% y/y remains off its high of 7.7% in the spring of 2022; leisure & hospitality pay rose a diminished 4.9% y/y. Professional & business services pay grew an improved 4.7% y/y, but still was below a 6.9% high in October 2022. Pay increases for “job changers” averaged 7.2% y/y in November, up from 6.7% y/y in the prior two months.
Small business hiring (less than 50 employees) declined 17,000 (+0.1% y/y) last month after rising 12,000 in October. Employment at medium-sized firms (50-499,000 employees) rose 42,000 (1.7% y/y) after a 53,000 October increase. These gains remained below the March high of 113,000. Large business hiring (500+ employees) rose 120,000 (3.8% y/y) during November following a 118,000 October gain.
Goods-producing employment rose 6,000 last month (1.6% y/y) after a 26,000 November rise. It was the smallest increase in six months and below the recent high of 48,000 high in March. The number of construction sector jobs rose 30,000 (4.8% y/y) following a 38,000 gain in October. Jobs in the manufacturing sector fell 26,000 (-0.4% y/y) last month and have fallen in all but one month since April. Natural resource & mining hiring improved 2,000 (1.6% y/y) after a 6,000 decline in October.
The number of service-producing jobs rose 140,000 (1.4% y/y) in November following a 158,000 October gain. Education employment strengthened 50,000 (1.8% y/y) last month after rising 59,000 in October. The number of jobs in trade, transportation & utilities increased 28,000 (1.0% y/y) following a 2,000 improvement. Employment in “other” services rose 20,000 (4.1% y/y) after increasing 19,000 in October. Professional & business services employment rose 18,000 (0.2% y/y) following an 11,000 gain. Leisure & hospitality employment rose 15,000 (2.4% y/y) after improving 39,000 in October. Financial sector employment rose 5,000 (1.9% y/y) after increasing 19,000 in October while information employment rose 4,000 last month (-1.5% y/y) following a 9,000 rise.
The ADP National Employment Report and Pay Insights data can be found in Haver's USECON database. Historical figures date back to January 2010 for private employment. Pay data date back to October 2020. The expectation figure is available in Haver's AS1REPNA database.
The Fed’s latest Beige Book covering regional economic conditions can be found here.
Tom Moeller
AuthorMore in Author Profile »Prior to joining Haver Analytics in 2000, Mr. Moeller worked as the Economist at Chancellor Capital Management from 1985 to 1999. There, he developed comprehensive economic forecasts and interpreted economic data for equity and fixed income portfolio managers. Also at Chancellor, Mr. Moeller worked as an equity analyst and was responsible for researching and rating companies in the economically sensitive automobile and housing industries for investment in Chancellor’s equity portfolio. Prior to joining Chancellor, Mr. Moeller was an Economist at Citibank from 1979 to 1984. He also analyzed pricing behavior in the metals industry for the Council on Wage and Price Stability in Washington, D.C. In 1999, Mr. Moeller received the award for most accurate forecast from the Forecasters' Club of New York. From 1990 to 1992 he was President of the New York Association for Business Economists. Mr. Moeller earned an M.B.A. in Finance from Fordham University, where he graduated in 1987. He holds a Bachelor of Arts in Economics from George Washington University.
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