When compared to the month of March, the hiring of employees in the private sector for the month of April has improved dramatically in the United States. This is despite the interest rate hikes and the problem of inflation that has been plaguing the nation.
Overview
According to the latest report that was released by ADP, private payrolls increased by almost 300,000 for the month of April, which is much higher than what was projected. The Dow Jones projected that the private sector would only add roughly 200,000 jobs in April, so the numbers were certainly exceeded. During the month of March, the private sector only added 142,000 jobs. This is a sign that the labor market is heating up dramatically.
Labor Market Showing Resilience
ADP says the United States economy has added over 800,000 jobs this year. This is a sign that the labor market is remaining resilient despite the rapid inflation and rate hikes by the Fed to combat inflation. Despite jobs being added, annual pay rate increases have decreased slightly this year, going from 7% down to 6.7%.
Industry Breakdown
The service industry saw the biggest gain in employment for the month of April, as the sector added 154,000 jobs, specifically in the areas of leisure and hospitality. When it comes to losses, the manufacturing sector lost roughly 38,000 jobs in April. Additionally, financial institutions lost 28,000 jobs after the collapse of multiple US banks.
Wrap Up
Despite the Fed raising interest rates to tame job growth and economic activity, the ADP report shows that this may not work. The private sector is continuing to add jobs as well as the rest of the labor market, so we will have to wait and see if rate hikes will continue to be the solution for the Federal Reserve.