New data from payrolls processing firm ADP shows the biggest decline in private payrolls in two-and-a-half years as well as a hiring slowdown that's worrying experts, CNBC reports.
The data, CNBC says, is a "further sign of labor market weakening that compounds the data blackout accompanying the U.S. government shutdown."
According to the ADP report released Wednesday, "companies shed a seasonally adjusted 32,000 jobs during the month, the biggest slide since March 2023," a disappointment to economists surveyed by Dow Jones, which reported that they "had been looking for an increase of 45,000."
Compounding that disappointment was revision of the August payrolls number to a loss of 3,000 from an initially reported increase of 54,000.
The government shutdown doesn't help either, and assuming there will be no deal to reopen the government, "the Bureau of Labor Statistics’ nonfarm payrolls report for September will not be released, nor will the Labor Department put out the weekly jobless claims count on Thursday. The last time the BLS payrolls report was delayed was in 2013," CNBC says
“Despite the strong economic growth we saw in the second quarter, this month’s release further validates
what we’ve been seeing in the labor market, that U.S. employers have been cautious with hiring,” ADP chief economist Nela Richardson said.
And despite the unemployment rate being relatively low at 4.3 percent, concerns over the state of the labor market are growing.
“My baseline outlook doesn’t see the labor market softening much further – but there are risks,” Boston Fed President Susan Collins said Tuesday.
“In particular, I see some increased risk that labor demand may fall significantly short of supply, leading to a more meaningful and unwelcome increase in the unemployment rate," she said.