ADP National Employment Report: Private Sector Employment Increased by 107,000 Jobs in January; Annual Pay was Up 5.2%

The ADP National Employment Report is an independent measure and high-frequency view of the private-sector labour market based on actual, anonymized payroll data of more than 25 million U.S. employees.

Private sector employment increased by 107,000 jobs in January and annual pay was up 5.2 percent year-over-year, according to the January ADP National Employment Report produced by the ADP Research Institute in collaboration with the Stanford Digital Economy Lab (“Stanford Lab“). The ADP National Employment Report is an independent measure and high-frequency view of the private-sector labor market based on actual, anonymized payroll data of more than 25 million U.S. employees.

The jobs report and pay insights use ADP’s fine-grained anonymized and aggregated payroll data to provide a representative picture of the private-sector labor market. The report details the current month’s total private employment change, and weekly job data from the previous month. Because the underlying ADP payroll databases are continuously updated, the report provides a high-frequency, near real-time measure of U.S. employment. This measure reflects the number of employees on ADP client payrolls (Payroll Employment) to provide a richer understanding of the labor market. ADP’s pay measure uniquely captures the earnings of a cohort of almost 10 million employees over a 12-month period.

“Progress on inflation has brightened the economic picture despite a slowdown in hiring and pay,” said Nela Richardson, chief economist, ADP. “Wages adjusted for inflation have improved over the past six months, and the economy looks like it’s headed toward a soft landing in the U.S. and globally.”

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January 2024 Report Highlights*

View the ADP National Employment Report and interactive charts at www.adpemploymentreport.com.

Jobs Report

Private employers added 107,000 jobs in January
The hiring slowdown of 2023 spilled into January, and pressure on wages continues to ease. The pay premium for job-switchers shrank to a new low last month.

Change in U.S. Private Employment:     107,000

Change by Industry Sector

– Goods-producing:     30,000

• Natural resources/mining     6,000
• Construction     22,000
• Manufacturing     2,000

– Service-providing:     77,000

• Trade/transportation/utilities     23,000
• Information     -9,000
• Financial activities     7,000
• Professional/business services     2,000
• Education/health services     17,000
• Leisure/hospitality     28,000
• Other services     9,000

Change by U.S. Regions

– Northeast:     32,000

• New England     5,000
• Middle Atlantic     27,000

– Midwest:     24,000

• East North Central     17,000
• West North Central     7,000

– South:     57,000

• South Atlantic     39,000
• East South Central     -1,000
• West South Central     19,000

– West:     2,000

• Mountain     2,000
• Pacific     0

Change by Establishment Size

– Small establishments:     25,000

• 1-19 employees     19,000
• 20-49 employees     6,000

– Medium establishments:     61,000

• 50-249 employees     53,000
• 250-499 employees     8,000

– Large establishments:     31,000

• 500+ employees     31,000

Pay Insights

Pay gains continued to shrink in January
Year-over-year pay gains for job-stayers reached 5.2 percent in January, down from 5.4 percent in December. For job-changers, pay was up 7.2 percent, the smallest annual gain since May 2021.

Median Change in Annual Pay (ADP matched person sample)

– Job-Stayers     5.2%
– Job-Changers     7.2%

Median Change in Annual Pay for Job-Stayers by Industry Sector

– Goods-producing:

• Natural resources/mining     4.7%
• Construction     5.6%
• Manufacturing     4.8%

– Service-providing:

• Trade/transportation/utilities     4.7%
• Information     4.5%
• Financial activities     5.6%
• Professional/business services     5.1%
• Education/health services     5.9%
• Leisure/hospitality     6.3%
• Other services     5.5%

Median Change in Annual Pay for Job-Stayers by Firm Size

– Small firms:                                                                

• 1-19 employees     4.5%
• 20-49 employees     5.4%

– Medium firms:                                                             

• 50-249 employees     5.5%
• 250-499 employees     5.4%

– Large firms:                                                                

• 500+ employees     5.1%

To see Pay Insights by U.S. State, Gender, and Age for Job-Stayers

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