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US ADP employment increased by 86,000 in October, which was better than expected, indicating that the private labor market remains stable, and the pace of wages and hiring still support the economy.
The number of new jobs created by U.S. companies last month was higher than expected, showing that the U.S. labor market is broadly stable and the economy remains strong.
The ADP employment report, known as the “small non-farm sector”, showed U.S. private employment rose by 86,000 people in October, far exceeding the Reuters estimate of 69,000. Additionally, private employment was revised upward to 86,000 in September.
Industries that have increased hiring include trade, transportation, education, public utilities, health services, leisure and hospitality, construction, etc., and employee salaries have increased at companies of all sizes.
Bright consumer spending and strong economic growth have supported labor market flexibility, allowing companies to expand their workforces even as cost pressures remain high. Companies have kept up hiring, keeping unemployment low and allowing the Fed to focus on the fightinflation .
ADP chief economist Richard Richardson said in a statement that all employers at large, medium and small companies hired people last month. Data shows that apart from higher base salary, factors attracting employees to change jobs include bonuses, overtime pay, etc.
The report, jointly released by ADP and Stanford University Digital Economics Laboratory, showed that the wages of departing workers increased by 7.6% compared with the same period last year, the largest increase in 2024; Wage growth for retained employees stood at 4.4%, the same as in September.
Because the government will release the non-agricultural employment report two days after the release of the ADP data, it has attracted a lot of attention from economists and investors and is considered an important leading indicator of labor market conditions.
It is estimated that the official employment report released on the 6th will see an increase of 65,000 non-agricultural employment. Government reports cover the public and private sectors, while the ADP covers only the private sector.
Summary FAQ
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U.S. private employment rose by 86,000 in October, well above a Reuters forecast of 69,000, and September’s data was also revised upward to show the job market is resilient.
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Industries where hiring increased included trade, transportation, education, public utilities, health services, leisure and hospitality, and construction, indicating that employment expansion is not concentrated in a single sector.
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The ADP report is usually considered an important leading indicator before official non-farm payrolls, as government employment data released two days later covers the public and private sectors, and investors will use it to assess the labor market trend.
