What Recession? New Jobs Data Doubles Expectations, What You Need To Know

Private sector employment in the U.S. surged in April, with a total of 296,000 jobs added during the month, according to data issued in the ADP National Employment Report.

What Happened: The job additions are a significant increase compared to the revised 142,000 jobs added in March, and are more than double the expected estimate of 148,000.

The leisure and hospitality sectors saw the biggest gains, adding 154,000 jobs, followed by education and health services with 69,000 jobs, and construction, which added 53,000 jobs.

While hiring remains strong, the report also highlighted a slowdown in pay growth, with annual pay rising 6.7% year-over-year in April, compared to 6.9% in March.

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Nela Richardson, Chief Economist at ADP, suggested that the slowdown in pay growth could indicate what's going on in the labor market, as employers continue to hire aggressively while holding pay gains in check as more workers come off the sidelines.

The report also showed fewer people switching jobs, suggesting that the current job market favors employers.

Despite the surge in private sector employment, some sectors saw declines in job numbers. The financial industry shed 28,000 jobs in April, while manufacturing declined by 38,000 jobs.

ADP’s report noted that the job gains were fairly evenly distributed across company size, with small establishments contributing 121,000 jobs, medium establishments contributing 122,000 jobs, and large establishments contributing 47,000 jobs.

The latest ADP report serves as a precursor to the Labor Department's nonfarm payrolls count, due out later this week, which is expected to show a gain of around 190,000 jobs in April.

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