U.S. employers in the private sector added about 89,000 jobs in September, a much smaller total than expected and an indication of a sharp decline in the labor market, payroll processor ADP reported Wednesday.
It is the slowest pace of private sector job growth since January 2021, according to ADP tabulations.
Economists expected a net gain of 153,000 jobs, according to Refinitiv consensus estimates.
“We are seeing an increasingly steep decline in employment this month,” Nela Richardson, chief economist at ADP, said in a statement Wednesday morning. “In addition, we are seeing a steady decline in wages over the past 12 months.”
The ADP report is an independent measure of employment trends and is developed using aggregated, anonymized payroll data from its clients.
While ADP tabulations don’t always correlate with the official federal jobs report (due out Friday), they are sometimes considered an indicator of overall hiring activity, which has been gradually declining.
Still, the data can be irregular month to month.
On Tuesday, the Bureau of Labor Statistics’ August Job Openings and Labor Turnover Survey report showed that the number of available jobs rose unexpectedly, rattling markets. However, economists were quick to point out that the underlying trend remains one of cooling.
On Friday, the BLS will release the important monthly employment report for September. Economists expect a net gain of 170,000 jobs.
This story is developing and will be updated.