The job market closed 2022 on a high note as companies added many more positions in December than expected, payroll processing firm ADP reported on Thursday.
Private payrolls are up 235,000 this month, well above the Dow Jones estimate of 153,000 and the originally reported 127,000 for November.
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The goods-producing sector increased by 22,000 at a relatively meager rate, while service providers added 213,000 positions, led by the leisure and hospitality industry, by 123,000. Professional and business services increased by 52,000, while education and health services increased by 42,000.
Stock market futures drop Following the report as investors feared strong employment numbers could push the Federal Reserve to continue raising interest rates.
Big things come despite surprise Federal Reserve’s initiatives to slow a sizzling job market that has pushed inflation closer to its highest level in over 40 years.
the central bank raised interest rates Seven times in 2022, a total of 4.25 percent, and officials have identified labor market imbalances as a key area they want to target. there is still about 1.7 open positions for every current employeeA situation that leads to a rise in wages but still fails to keep up with cost-of-living increases.
ADP reported that annual fees in all categories rose 7.3% from a year ago, led by a 10.1% increase in the entertainment and hospitality industry.
“The job market is strong but fragmented, and hiring varies sharply by industry and organization size,” said Nela Richardson, chief economist at ADP. “Business segments that hired aggressively in the first half of 2022 slowed hiring and in some cases laid off in the last month of the year.”
Trade, transportation and utilities lost 24,000 jobs per month, while natural resources and mining decreased by 14,000 and financial activities decreased by 12,000. Other key winners by industry included professional and business services (52,000), education and healthcare (42,000), and construction (41,000).
Job gains were evenly distributed among small and medium enterprises, which together added 386,000 workers. Companies with more than 500 employees reported a 151,000 drop.
Employment growth is limited to a year with an average of around 300,000 per month, according to ADP data, which can differ significantly from the Department of Labor’s official non-farm payroll numbers.
That growth came despite an economy that saw negative growth in the first two quarters — a widely accepted definition of recession — and aggressive tightening by the Fed. At their meeting in December, central bank policymakers said they plan to continue raising rates and do not expect any cuts until at least 2023. by minute Published Wednesday.
The ADP report comes a day ahead of the Labor Department’s number, which is expected to show 200,000 growth in non-farm jobs and an unemployment rate holding steady at 3.7%. non-agricultural Payrolls increased by 263 thousand in NovemberIt was much larger than the ADP sum.
