The US private sector added 62,000 jobs in March, beating analysts’ initial forecast of 40,000. The data from ADP showed a better-than-expected labor market resilience despite global economic pressures and ongoing Middle East conflicts.
The growth was largely driven by small businesses and the education and health services sectors. However, the trend was not universal as manufacturing, trade, and transportation continued to record job losses due to the slowdown in industrial activity.
ADP chief economist Nela Richardson noted that while hiring overall was stable, it was now concentrated in certain industries. Healthcare remained the main driver of job growth amid uncertainty in other sectors.
Despite the positive ADP figures, official government data painted a more worrying narrative. February’s hiring rate was the lowest in six years, with 92,000 jobs lost overall and the unemployment rate rising to 4.4%.
The Chicago Fed projects the unemployment rate will continue to rise to 4.5% in March. The market is now awaiting an official report from the US Labor Department on Friday morning to confirm whether the labor market is truly stabilizing or heading towards a more serious downturn.
