The Ritz Herald
Chicago Ford Assembly Plant, Illinois. © Scott Olson

U.S. Private Sector Employment Increased by 177,000 Jobs in August


Annual pay was up 5.9%

Published on September 02, 2023

Private sector employment increased by 177,000 jobs in August and annual pay was up 5.9 percent year-over-year, according to the August ADP® National Employment ReportTM produced by the ADP Research Institute® in collaboration with the Stanford Digital Economy Lab (“Stanford Lab”). The ADP National Employment Report is an independent measure and high-frequency view of the private-sector labor market based on actual, anonymized payroll data of more than 25 million U.S. employees.

The jobs report and pay insights use ADP’s fine-grained anonymized and aggregated payroll data to provide a representative picture of the private-sector labor market. The report details the current month’s total private employment change, and weekly job data from the previous month. Because the underlying ADP payroll databases are continuously updated, the report provides a high-frequency, near real-time measure of U.S. employment. This measure reflects the number of employees on ADP client payrolls (Payroll Employment) to provide a richer understanding of the labor market. ADP’s pay measure uniquely captures the earnings of a cohort of almost 10 million employees over a 12-month period.

“This month’s numbers are consistent with the pace of job creation before the pandemic,” said Nela Richardson, chief economist, ADP. “After two years of exceptional gains tied to the recovery, we’re moving toward more sustainable growth in pay and employment as the economic effects of the pandemic recede.”

The July total of jobs added was revised from 324,000 to 371,000. The historical data file, and weekly data for the previous month, is available here.

ADP conducted a rebenchmarking of its employment data in August based on full-year 2022 results from the Quarterly Census of Employment and Wages (QCEW). This resulted in 7,000 jobs being added to the August ADP National Employment Report. ADP’s full-year benchmarking will take place in February 2024 with the publication of the January 2024 report.

JOBS REPORT

Private employers added 177,000 jobs in August
Job growth slowed notably last month, driven heavily by leisure and hospitality. Job creation by hotels, restaurants and other employers in the sector fell to 30,000 in August after months of strong hiring.

Change in U.S. Private Employment:     177,000

Change by Industry Sector
– Goods-producing:     23,000

  • Natural resources/mining     5,000
  • Construction     6,000
  • Manufacturing     12,000

– Service-providing:     154,000

  • Trade/transportation/utilities     45,000
  • Information     5,000
  • Financial activities     0
  • Professional/business services     15,000
  • Education/health services     52,000
  • Leisure/hospitality     30,000
  • Other services     7,000

Change by U.S. Regions
– Northeast:     59,000

  • New England     -3,000
  • Middle Atlantic     62,000

– Midwest: -15,000

  • East North Central     -11,000
  • West North Central     -4,000

– South:     119,000

  • South Atlantic     54,000
  • East South Central     7,000
  • West South Central     58,000

– West: 13,000

  • Mountain     26,000
  • Pacific     -13,000

Change by Establishment Size
– Small establishments:     18,000

  • 1-19 employees     1,000
  • 20-49 employees     17,000

– Medium establishments:     79,000

  • 50-249 employees     74,000
  • 250-499 employees     5,000

– Large establishments:     83,000

  • 500+ employees     83,000

PAY INSIGHTS 

Pay growth continued its slowdown in August
Job stayers saw a year-over-year pay increase of 5.9 percent, the slowest growth since October 2021. For job changers, pay growth also decelerated, to 9.5 percent. For the first time, all 50 states and Washington, D.C., experienced a slowdown in pay growth.

Median Change in Annual Pay (ADP matched person sample)

  • Job-Stayers     5.9%
  • Job-Changers     9.5%

Median Change in Annual Pay for Job-Stayers by Industry Sector
– Goods-producing:

  • Natural resources/mining     5.9%
  • Construction     6.0%
  • Manufacturing     5.5%

– Service-providing:

  • Trade/transportation/utilities     5.8%
  • Information     5.4%
  • Financial activities     6.2%
  • Professional/business services     5.8%
  • Education/health services     6.5%
  • Leisure/hospitality     6.9%
  • Other services     5.8%

Median Change in Annual Pay for Job-Stayers by Firm Size
– Small firms: 

  • 1-19 employees     5.1%
  • 20-49 employees     6.0%

– Medium firms: 

  • 50-249 employees     6.2%
  • 250-499 employees     6.0%

– Large firms: 

  • 500+ employees     6.0%

To see Pay Insights by U.S. State, Gender, and Age for Job-Stayers, visit here

* Sum of components may not equal total, due to rounding.

Enterprise Editor