In June, American enterprises increased their hiring at a milder pace, with slower wage growth, in line with the signs of cooling labor demand.
According to ADP Research Institute data, the US private sector added 150,000 jobs in June, mainly due to employment growth in leisure and hospitality industries. Economists surveyed by Bloomberg estimate a median increase of 165,000.
"Job growth has been solid but not broad-based," said Nela Richardson, chief economist at ADP. "If it weren't for the rebound in hiring in leisure and hospitality, June would be a weak month."
The ADP report further indicates that the labor market is gradually cooling down, with the unemployment rate rising to 4% in May, the highest level in more than two years. The number of people continuously claiming unemployment benefits has also increased, indicating that unemployed Americans need more time to find a job.
Jerome Powell, chair of the Federal Reserve, said at a European Central Bank meeting on Tuesday that the labor market has taken a substantial step towards supply-demand balance.
ADP data released in cooperation with the Stanford Digital Economy Lab on Wednesday showed that the wage growth of job-hoppers slowed for the third consecutive month in June, with a year-on-year growth rate of 7.7%. The year-on-year growth rate of salaries for remaining employees was 4.9%, the lowest level since mid-2021.