WASHINGTON, DC — Private employers in the United States added 90,000 jobs in September, a pickup that suggests the labor market may be stabilizing after several months of weaker hiring, according to payroll processor ADP.
The gain was far stronger than August’s revised increase of 36,000 jobs and also topped economists’ expectations for 68,000 new positions. ADP said the September increase marked a rebound after a three-month slowdown in private-sector job creation.
Base pay continued to rise as hiring improved, with ADP saying wage growth remained solid. The company’s latest estimate arrives just before the Bureau of Labor Statistics releases its official employment report on Friday.
Education and health services drove the biggest September hiring gains
Hiring was strongest in education and health services, which added 55,000 jobs in September. Leisure and hospitality followed with 22,000 new positions, while manufacturing added 17,000 and construction increased by 15,000.
ADP said service-providing industries accounted for 59,000 of the new jobs, while goods-producing businesses added 31,000. That split shows the rebound was broad enough to reach both major parts of the private sector, even if the gains were not evenly spread.
Some industries continued to lose workers. Financial activities shed 16,000 jobs, professional and business services lost 11,000, and natural resources and mining declined by 1,000 positions.
Mid-sized companies and the Northeast led the rebound
By region, the Northeast posted the largest job increase, with 56,000 positions added in September. ADP did not break out the other regions in the same detail, but the data pointed to a concentrated boost in that part of the country.
Company size also mattered. Firms with 50 to 499 employees led hiring among business categories, adding 54,000 jobs. That suggests mid-sized employers were among the most active in September after the broader slowdown earlier in the summer.
The ADP figures offer a snapshot of private payrolls, not a full picture of total employment. They are commonly watched as an early read on labor conditions, but they do not always line up with the federal government’s count.
Pay growth stayed solid even as hiring improved
ADP said base pay rose 3.2% from a year earlier in September, while gross pay increased 4.7%. For workers who stayed in the same job, base pay was up 3%. Those who changed jobs saw base pay climb 4.8%.
The wage data matters because it shows pay gains remained in place even as hiring picked up. For the Federal Reserve, that combination can complicate the effort to balance labor-market strength against inflation pressures.
ADP’s chief economist, Nela Richardson, described the September reading as a strong report and said hiring rebounded after a three-month slowdown while pay growth stayed firm.
The Federal Reserve is watching jobs and inflation together
The labor-market update comes as the Federal Reserve continues weighing the pace of hiring against the persistence of inflation. Earlier this month, the central bank raised its benchmark interest rate by 0.25 percentage points, lifting the target range to 3.75% to 4%.
According to Reuters, policymakers have been paying closer attention to inflation while still viewing the labor market as relatively stable. The ADP numbers add another data point to that assessment, but they do not settle it.
Markets and policymakers will get a fuller reading on Friday, when the Bureau of Labor Statistics publishes the September employment report. That government release is the more closely watched gauge of the U.S. jobs picture.
Economists expect Friday’s official report to show further hiring
Reuters’ latest survey of economists expects the official BLS report to show 90,000 nonfarm jobs added in September, with the unemployment rate holding at 4.1%. If that forecast proves accurate, it would line up closely with ADP’s estimate.
Even so, ADP’s private-payroll measure has historically not matched the federal government’s numbers very well. Economists and investors therefore treat it as an early signal rather than a definitive count.
For now, the September ADP report points to a labor market that may be regaining momentum after a three-month slowdown, with wage growth still holding up across many workers and industries.