The number of private sector jobs in the United States rose less than expected in August, the latest sign that the labor market is slowing, though it remains strong.
Private employment increased by 177,000 positions last month, as shown in ADP's National Employment report on Wednesday. Economists have even predicted that private employment will increase by 195,000. Data for July was revised higher to show the addition of 371,000 jobs compared to the previous report which stated 324,000.
The labor market is gradually expanding slowly as it adjusts to a 525 basis point increase in interest rates by the Federal Reserve starting in March 2022. The government reported on Tuesday that there were 1.51 job vacancies for every unemployed person in July, the lowest ratio since September 2021, compared to 1.54 in June. A study from the Conference Board also showed consumers' views on the labor market were less optimistic in August.
The ADP report, developed with Stanford's Digital Economy Lab, was published ahead of the Labor Department's release of a more comprehensive and more closely watched jobs report for August on Friday. It should be understood, it is not a reliable indicator to predict the number of private jobs in the employment report.
Based on a Reuters survey of economists, the Bureau of Labor Statistics is expected to report that private employment increased by 150,000 positions in August. Including government jobs, total nonfarm payrolls are expected to have increased by 170,000 positions in August after rising 187,000 in July.
