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ADP: Salary Gains Slow as Hospitality Hiring Jumps


Americans who switch jobs are seeing larger raises than workers who stay put.

That’s according to the February edition of ADP’s National Employment Report, which showed 7.6% year-over-year pay gains for people who have changed jobs, marking the first increase since November 2022.

For people staying with their employer, pay gains continued to slow, at 5.1%, the smallest increase since August 2021, ADP said in Wednesday’s (March 5) press release. The private sector added 140,000 jobs in February.

“Job gains remain solid,” said Nela Richardson, ADP’s chief economist, said in the release. “Pay gains are trending lower but are still above inflation. In short, the labor market is dynamic, but doesn’t tip the scales in terms of a Fed rate decision this year.”

The largest gains came from the leisure/hospitality sector, which added 41,000 jobs, per the release. Other major gains were seen in the construction industry (28,000 jobs) and the trade/transportation/utilities spaces (24,000 jobs).

Two industries saw job losses for the month: natural resources/mining and information, down a respective 4,000 and 2,000.

PYMNTS Intelligence research from earlier this year found that 90% of consumers reported that their incomes have not kept up with inflation, with female consumers less likely to report inflationary-tracking wage increases compared to male counterparts. Only 14% of consumers said their earnings rose to match or exceed inflation.

“Switching jobs is how many consumers have been able to jump-start their take-home pay,” PYMNTS wrote in January. “But while 62% of consumers are dissatisfied with their earnings, only one-third think they could successfully switch jobs and find a new position that would both meet their qualifications and satisfy their wage demands.”

More recent research found that higher-income earners were less likely to switch jobs. They were also more likely to be living paycheck to paycheck, according to the latest edition of PYMNTS Intelligence’s “New Reality Check: The Paycheck to Paycheck Report.”

Since last January, the share of consumers earning more than $100,000 and living paycheck to paycheck has also increased to 48%, and 36% for consumers with incomes above $200,000.

“Even though they tend to have higher incomes, millennials are more likely to live paycheck to paycheck, as are urban consumers,” the report said. “The ongoing rise in the cost of living, especially housing costs, could explain these shifts in financial standing across demographics.”