MNI BRIEF: US Labor Market Data Heating Up Again - ADP
Friday's jobs report will likely show hiring and pay growth reaccelerating this year compared to the end of 2023.
Friday's U.S. jobs report is likely to corroborate ADP employment data showing hiring and pay growth is heating up again this year after slowing in the second half of last year, ADP chief economist Nela Richardson said Wednesday after the payroll service provider reported private employers added a stronger-than-expected 192,000 jobs in April and upward revisions to previous months.
Leisure and hospitality took a step back late last year but added 56,000 jobs in April to boost service sector hiring to 145,000. Overall hiring was broad based with large establishments looking strongest, Richardson said.
Pay gains for job stayers were little changed last month at 5% while job changers saw pay gains jump to 10.1% from 7.6% a month earlier, based on data on 10 million employees, and could continue to "oscillate," she said. After meaningful deceleration in pay growth over past year, the stability in the March and April numbers "makes me wonder if we're reaching a plateau," Richardson said. Gains for job stayers at 2%-4% is more consistent with the Fed's inflation target, she added.
The Federal Reserve has "to keep (rates) at least at the current level, in my view, or they're going to risk a pickup in inflation." (See: MNI INTERVIEW: Fed Poised For Higher For Longer Stance - S&P)