Biden Economy Takes Another Embarrassing Tumble

Payroll behemoth ADP reports that U.S. firms gained just 152,000 new jobs in May, the smallest increase this year, suggesting that hiring may be slowing down.

Analysts had predicted a level closer to 175,000.

As the second half of the year approaches, “job gains and pay growth are slowing,” according to Nela Richardson, chief economist at ADP. Nela Richardson, chief economist at ADP, says the labor market is strong, but there are some noticeable weak spots related to both consumers and producers.

The two industries that are less reliant on general economic trends than others—health care and education—accounted for the majority of newly created jobs. People sometimes refer to these sectors as “government-adjacent”.

Nonetheless, there was a lot of momentum in the labor market sectors of trade, shipping, and construction—two areas that frequently reflect broader economic trends. Construction added 32,000 jobs, while trade, transportation, and utilities added 55,000.

Payrolls in the financial services industry increased by 28,000 in May, while employment in manufacturing, professional services, mining, and information services decreased.

Updated data revealed that April’s job growth was a little lower at 188,000.

According to ADP, employees who stayed put during the previous year had a 5% wage raise that remained constant for three months. In the meantime, those who changed jobs received a 7.8% salary increase; however, this percentage has been declining and is predicted to keep declining. Job changers experienced a peak increase of 16.4% two years ago.

ADP reports only cover hiring in the private sector. ADP does not intend to forecast Friday’s official jobs report. Rather, ADP asserts that it is a separate indicator of the job market.

Economists expect the Labor Department to report that the economy added 195,000 jobs in May, up from 175,000 in April.

In a separate report on Tuesday, the Labor Department reported that job opportunities decreased to 8.1 million, much below estimates, from 8.4 million the previous month.