Private sector employers in the United States added more jobs than expected in July, marking a rebound after the first decline in more than two years that occurred in June.
According to ADP data released on Wednesday, total private sector employment rose by 104,000 jobs in July, exceeding economists’ expectations of 75,000, and much better than the 23,000 job loss in June. The new data also showed a downward revision to the June job loss figure from 33,000 to 23,000.
Meanwhile, ADP data showed that wages for workers who changed jobs rose 7% from a year earlier in July, unchanged from the previous month. For workers who stayed in the same job, the wage growth rate increased 4.4%, down slightly from 4.5% in June.
The data came just hours before the Federal Reserve is expected to release its latest monetary policy statement. The Federal Reserve is expected to keep interest rates on hold, but at least one member of the Federal Open Market Committee (FOMC) has called for a rate cut.
In a speech on July 17, Fed Governor Christopher Waller said he believed the Fed should cut rates at this meeting because “private sector employment growth has now almost ground to a halt, and other data suggests risks to the labor market are increasing.”
Other labor market data also showed signs of softening. On Tuesday, the Bureau of Labor Statistics reported 7.44 million job openings at the end of June, down from 7.71 million the previous month. The hiring rate fell to 3.3%, the lowest since November 2024.
All of this data is considered a lead-up to key jobs reports this week. On Friday, the July jobs report is expected to show an addition of 101,000 nonfarm payrolls to the U.S. economy, while the unemployment rate is expected to edge up to 4.2%, according to Bloomberg estimates. In comparison, the US economy added 144,000 jobs in June, while the unemployment rate then unexpectedly dropped to 4.1%.
