Source: Wall Street News
Author: Chang Jiashuai
In May, economic data such as PCE were released one after another, showing that the US economy continues to be strong, and strong employment data undoubtedly added fuel to expectations of interest rate hikes in June.
On Thursday, June 1, the US ADP employment report showed that the number of people employed in the US private sector increased by 278,000 after seasonal adjustments in May, higher than the market forecast of 170,000, and slightly lower than 291,000 after the April reduction. The increase in May brought the number of employed people to 1.09 million in 2023 so far.
The ADP report points out that from an industry perspective, job growth during the month was relatively scattered. The leisure and hospitality industry added the most new jobs, reaching 208,000, followed by the natural resources and mining industry, with 94,000 new jobs, the construction industry added 64,000 new jobs, the trade, transportation and utilities jobs increased 32,000, while other service categories increased 12,000.
There have also been declines in the number of jobs in several industries.
For example, the number of manufacturing jobs fell by 48,000, the financial sector by 35,000, and education and health services by 29,000.
From a scale perspective, mid-sized companies with 500 or more employees lost 106,000 jobs. Smaller companies with fewer than 50 workers added 235,000 public toilets.
However, it is worth noting that the ADP report shows that the rate of wage growth in the US is slowing down. The annual wage increase in May was still 6.5%, but it is down from 6.7% in April.
ADP chief economist Nela Richardson said:
“Wage growth is slowing sharply, and despite strong employment, wage driven inflation is likely to have less impact on the economy.”
After the data was released, the three major US stock indices declined in the short term.
Tomorrow, the US Department of Labor will release much-publicized non-farm data. The ADP report is often seen as a prelude to employment data published by the Department of Labor.
The agency commented that ADP employment data that exceeded expectations makes it likely that the market will include more upward risks in the pricing of the non-farm payroll report to be released tomorrow night. This also explains the negative reaction of the US stock market after the data was released.
Editor/jayden