For comparison, analysts were expecting 140,000 creations, according to the MarketWatch consensus.
U.S. private sector companies added 99,000 jobs in August, down sharply from July and far below expectations, according to the monthly ADP/Stanford Lab survey released Thursday, a new sign of the slowdown in the labor market after three years of robust growth. Analysts had expected 140,000 jobs to be created, according to the consensus from MarketWatch. The July figure was revised downward, with only 111,000 private sector jobs added, down from 122,000 initially forecast.
“The downward trend in the labor market has led to slower than normal hiring after two years of outsized growth”said Nela Richardson, ADP’s chief economist, in the statement. As for the evolution of wages, which is watched closely to anticipate the evolution of inflation, it remained stable in August compared to July.
The ADP/Stanford Lab survey is seen as a barometer of the official August employment figures, which will be released Friday by the Labor Department. The unemployment rate is expected to fall slightly to 4.2% from 4.3% in July, and job creation is expected to rise to 161,000 from 114,000. The health of the labor market is being closely monitored by the U.S. Federal Reserve, which plans to start cutting rates at its next meeting on Sept. 17-18. It wants to avoid causing unemployment to rise too much, while its measures aimed at slowing inflation are weighing on economic activity.
Also readUnited States: Job market lands softly
“Growing economic uncertainty”
While a labor shortage in the United States had contributed to the surge in inflation since 2021, signs that the situation is returning to normal are now multiplying. Job creations for 2023 and early 2024 have been revised sharply downward. The number of vacancies even fell at the end of July to its lowest level since January 2021, before the country experienced a major labor shortage, the JOLTS survey published by the Labor Department showed on Wednesday.
Job cuts in August reached their second highest level since 2009, according to a monthly study by consulting firm Challenger, Gray & Christmas, released Thursday. “The increase in job cuts in August reflects growing economic uncertainty and changing market dynamics”commented Andrew Challenger, vice president of the firm.
A Fed survey over the summer showed that some parts of the U.S. are seeing a slowdown in the labor market, with employers being more selective and, as a result, applicants taking longer to find jobs. And Atlanta Fed President Raphael Bostic said Wednesday that after three years of focusing on inflation, he now gives as much importance to the employment situation as to rising prices.
