Private payroll growth in the U.S. came in weaker than anticipated in August, according to data released Thursday by ADP.
The report showed private-sector jobs increased by 54,000 last month, well below July’s upwardly revised gain of 106,000. Economists had expected a stronger showing of about 65,000 new positions, compared with the 104,000 initially reported for July.
“The year started with strong job growth, but that momentum has been whipsawed by uncertainty,” noted ADP chief economist Dr. Nela Richardson. “A variety of things could explain the hiring slowdown, including labor shortages, skittish consumers, and AI disruptions.”
Adding to the signs of labor market cooling, the Labor Department said first-time claims for unemployment insurance rose more than expected in the week ending August 30. Initial claims reached 237,000, up 8,000 from the prior week’s unrevised 229,000. Economists had forecast a smaller increase to 230,000. The four-week moving average also ticked higher to 231,000, up from 228,500.
The Labor Department released additional figures showing productivity improved more sharply than initially estimated in the second quarter. Labor productivity jumped 3.3%, compared with the previously reported 2.4%, while unit labor costs rose by 1.0%, slower than the earlier estimate of 1.6%. Both figures were expected to remain unchanged.
Meanwhile, the Commerce Department reported that America’s trade gap widened beyond forecasts in July. The deficit expanded to $78.3 billion from a revised $59.6 billion in June, surpassing projections of $75.7 billion. Imports surged 5.9% to $358.8 billion, while exports edged up 0.3% to $280.5 billion.
Looking ahead, investors are awaiting a series of economic updates. At 10 a.m. ET, the Institute for Supply Management will publish its August services PMI, expected to rise slightly to 50.5 from July’s 50.1, signaling modest growth. The Treasury Department will announce auction details for three-, ten-, and thirty-year securities at 11 a.m. ET.
At noon, the Energy Information Administration will release weekly crude oil inventory data. Shortly after, at 12:05 p.m. ET, New York Fed President John Williams will deliver remarks at the Economic Club of New York. Later in the evening, at 7 p.m. ET, Chicago Fed President Austan Goolsbee will participate in a Q&A session hosted by the mHub Industry Disruptor Series.
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