Private-sector jobs increased for the fifth straight month in January, as progress on inflation has brightened the economic picture despite a slowdown in hiring and pay.
The latest figures show the hiring slowdown of 2023 spilled into January, and pressure on wages continues to ease. Especially when looking at the pay premium for job-switchers, which shrank to a new low last month.
“Wages adjusted for inflation have improved over the past six months, and the economy looks like it’s headed toward a soft landing in the U.S. and globally,” Nela Richardson, chief economist, ADP, said.
When looking at where these jobs surfaced, the service-providing sector added 77,000 jobs, with leisure/hospitality adding the most with 28,000 positions. Meanwhile, the goods-producing sector added 30,000 spots in all.
Pay gains continued to shrink in January, as year-over-year pay gains for job-stayers reached 5.2% in January, down from 5.4% in December. For job-changers, pay was up 7.2%, the smallest annual gain since May 2021.