ADP February 2024 Jobs Report

Job gains came in multiple areas, led by leisure and hospitality with 41,000 and construction, which added 28,000 jobs. Other industries that showed strong gains included trade, transportation, and utilities (24,000), finance (17,000) and other services category (14,000).

Of the total, 110,000 came from the services sector while goods producers added 30,000. The growth was concentrated among larger companies, with organizations with fewer than 50 employees contributing just 13,000 employees to the total.

Along with job growth, annual wages increased by 5.1% for those who remained in their jobs, which ADP said was the smallest increase since August 2021, a possible indication that inflation pressures are easing.

The report comes as the labor market receives additional attention for signals about whether US economic growth will stall this year after gross domestic product recorded a strong annual increase of 2.5 percent in 2023.

“Job gains remain strong. Wage gains are trending downward but still higher than inflation,” said Nella Richardson, chief economist at ADP. “In short, the labor market is dynamic, but it is not tipping the scales regarding the Fed’s interest rate decision this year.”

The ADP report precedes the Labor Department's official nonfarm payrolls report, which will be released on Friday. In recent months, ADP numbers have been lower than a closely watched report from the Bureau of Labor Statistics, which showed an increase of 353,000 in January, more than three times the ADP estimate.

Economists surveyed by Dow Jones expect Friday's report to show an increase of 198,000.