US private sector adds higher-than-expected jobs in July

The US private sector’s job growth was much higher than expected in July, alleviating concerns about a slowdown in the labor market and the broader economy.

According to the monthly ADP report released today, July 30, the US private sector added 104,000 jobs this month, well above the expected 64,000 jobs. This came compared to a revised reading for June that showed a loss of around 23,000 jobs.

Major sectors contributed to the job gains. Leisure and hospitality added 46,000 jobs, followed by financial activities (28,000). Meanwhile, the education and health services sector lost 38,000 jobs.

Wages rose 4.4% year-on-year in July, the data showed.

Nela Richardson, ADP’s Chief Economist, said in the report: “Our hiring and pay data are broadly indicative of a healthy economy. Employers have grown more optimistic that consumers, the backbone of the economy, will remain resilient.”

Investors are now awaiting the US Labor Department’s official monthly jobs report, due Friday, with forecasts pointing to the addition of 100,000 jobs in July and a slight uptick in the unemployment rate to 4.2%.