ADP Finds ‘Steepening’ Decline in Job Growth as Wages Dip

Private employers added 89,000 jobs last month, the slowest growth rate since early 2021.

That’s according to the monthly employment report released Wednesday (Oct. 4) by ADP, which also showed wage growth slowing.

“We are seeing a steepening decline in jobs this month,” ADP Chief Economist Nela Richardson said in a news release. “Additionally, we are seeing a steady decline in wages in the past 12 months.”

The 89,000 figure was a sharp drop from last month’s report, which showed employers adding 180,000 jobs. It’s also below the consensus figures from economists polled by various media outlets, which came in at the 150,000 to 153,000 range.

According to the report, the largest gains came from the leisure and hospitality space (92,000 jobs) construction sector (16,000 jobs). These were offset by losses in manufacturing (12,000 jobs) and professional and business services (32,000 jobs).

ADP found that people who stayed with their jobs saw pay increases of 5.9% year over year, marking the 12 consecutive month of slowing growth.

“Pay gains also shrank for job changers, to 9 percent, down from 9.7 percent in August,” the report said.

The ADP report came the same day as a survey by Morning Consult which found that the share of consumers with declining incomes had climbed from 10.7% in August to 11.8% last month, a trend fueled mostly by middle-income households.

Among respondents who make $100,000 per year or more, close to 20% said they expect their incomes to decline over the next four weeks.

Meanwhile, recent PYMNTS Intelligence shows that 72% of employed consumers say their wages have barely kept pace with inflation, or have simply not kept up.

Data from the latest “Consumer Inflation Sentiment Report” found that 40% of employed consumers believe that their salary doesn’t meet their expectations, a sentiment shared by nearly 50% of those who make below $50,000 each year.

“While consumers expect inflation to drop back to pre-2021 levels by January 2025, consumers’ purchasing power is still 11% lower than it was two years ago,” PYMNTS wrote recently. “To counter the erosion of their purchasing power, consumers are actively seeking additional work or even switching jobs to find better salary prospects.”

The survey also found that 41% of workers have picked up side gigs, a trend led by Generation Z and millennial workers. This isn’t confined to just low-wage workers — even consumers who make more than $100,000 per year are not immune to worries about inflation and rising prices, pushing them to look for extra employment.