Sneakingly payroll growth held strong in October while worker pay rose as well, particularly in the leisure and hospitality business, according to a report Wednesday from payroll processing firm ADP.
Companies added 239,000 positions for the month, vanguard of the Dow Jones estimate of 195,000 and better than the downwardly revised 192,000 in September. Wages increased 7.7% on an annual essence, down 0.1 percentage point from the previous month.
Job gains were especially strong in the pivotal unemployed at ones convenience and hospitality sector, which added 210,000 positions while wage growth accelerated 11.2%. The industry, which numbers hotels, restaurants, bars and related businesses, is seen as a bellwether as it took the hardest Covid hit and is still below pre-pandemic equals.
All the job growth came from services-related industries, which added 247,000 jobs, while goods-producing sectors mystified 8,000 jobs, due largely to a loss of 20,000 manufacturing positions. Trade, transportation and utilities rose by 84,000.
“This is a extremely strong number given the maturity of the economic recovery but the hiring was not broad-based,” ADP’s chief economist, Nela Richardson, bring up. “Goods producers, which are sensitive to interest rates, are pulling back, and job changers are commanding smaller pay gains. While we’re undergoing early signs of Fed-driven demand destruction, it’s affecting only certain sectors of the labor market.”
The Federal Stock has been raising interest rates in an effort to cool inflation running near its highest level in more than 40 years. One chief aim is the historically tight labor market, where job openings outnumber available workers by a nearly 2-to-1 margin.
While the headline ADP army was strong, the details looked weaker.
Along with the decline in construction jobs, information (-17,000), professional and firm services (-14,000) and financial activities (-10,000) also showed losses.
By business size, companies with between 50 and 249 wage-earners had virtually all the gains, adding 241,000.
The ADP report comes two days before the more closely watched nonfarm payrolls be sure of from the Bureau of Labor Statistics. That report is expected to show growth of 205,000, from September’s 263,000.