“Though layoffs continue to be rare, a hesitancy to hire and a reluctance to replace departing workers led to job losses last month,” said Nela Richardson, ADP’s chief economist.
Service sectors were hit hardest, particularly professional and business services, which lost 56,000 jobs, and health and education, down by 52,000. Financial activities saw a decline of 14,000.Also Read:
Microsoft to cut 9,000 workers in second wave of major layoffsIn contrast, goods-producing sectors added 32,000 jobs, offsetting some of the broader loss.
Regionally, the Midwest and Western US recorded steep declines, down 24,000 and 20,000 jobs respectively. The South was the only region to see payroll growth, gaining 13,000 jobs.
Smaller firms bore the brunt of the cuts — companies with fewer than 20 employees lost 29,000 roles, while large firms (500+ employees) added 30,000 jobs.
Wage growth also cooled. Job stayers saw average annual pay growth slow to 4.4% in June from 4.5% in May. For job changers, pay growth eased to 6.8% from 7%.
Despite the weak report, ADP’s data doesn’t always align with official US government labour statistics, which investors weigh more heavily. The nonfarm payrolls report due Thursday is expected to show a gain of 110,000 jobs and a slight uptick in the unemployment rate to 4.3%.
