In a potentially welcoming sign for the Fed as it tries to wrangle stubborn inflation under control, wages continued to moderate in June. Annual pay rose 6.4% last month, down from 6.6% in May, according to the report. For workers who switched jobs, wages climbed 11.2%, down almost a full percentage point from the previous month.
“Consumer-facing service industries had a strong June, aligning to push job creation higher than expected,” said ADP chief economist Nela Richardson. “But wage growth continues to ebb in these same industries, and hiring likely is cresting after a late-cycle surge.”
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The most significant losses, meanwhile, were concentrated in the manufacturing sector, which saw payrolls tumble by 42,000. The information sector also shed 30,000, while financial activities cut 16,000
By size, medium and small businesses led the way in hiring last month, onboarding 183,000 and 299,000 workers, respectively. That is a reversal from prior months, in which small businesses struggled to find and retain workers. Large businesses lost 8,000 workers last month.
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The data precedes the release of the more closely watched June jobs report from the Labor Department on Friday morning, which is expected to show that employers hired 225,000 workers following a gain of 339,000 in May. The unemployment rate is expected to inch lower to 3.6%.
