WASHINGTON — U.S. private employers added 98,000 jobs in June, below economists' expectations and marking a slower pace of hiring than the previous month, according to the ADP National Employment Report released on Wednesday, suggesting labor market momentum remained subdued heading into the government's closely watched employment report.
Private payrolls increased by 98,000 jobs after an unrevised gain of 122,000 in May, ADP said. Economists surveyed by Reuters had expected an increase of about 118,000 jobs.
The report indicated that hiring remained uneven across industries, with education and health services accounting for the largest share of job gains. Financial activities, trade, transportation and utilities, information, and manufacturing also posted increases, while natural resources and mining lost jobs.
Service-providing industries added 96,000 positions during the month, while goods-producing industries gained 2,000 jobs overall, according to ADP.
"The pace of hiring is telling a story of both supply and demand," ADP Chief Economist Nela Richardson said in a statement. "We know it's taking people longer to find work, but there also are signs of labor supply constraints in certain industries. For now, the overall effect is a slowdown in job creation."
Hiring was strongest among small businesses, which added 53,000 jobs. Medium-sized firms created 29,000 positions, while large employers added 25,000 jobs.
The report also showed wage growth remained relatively stable. Annual pay for workers who stayed in their jobs increased 4.4% from a year earlier, while pay growth for job changers accelerated to 6.6%.
The ADP report, based on payroll data covering more than 26 million private-sector employees, often differs from the U.S. Labor Department's monthly employment report, though investors monitor it for indications of broader labor market trends.
The figures arrive as policymakers continue to assess whether hiring is cooling sufficiently to ease inflationary pressures without triggering a sharper deterioration in employment. Recent labor market indicators have pointed to moderating demand for workers while layoffs have generally remained low.
Economists cautioned that the ADP data should not be viewed as a direct predictor of the government's nonfarm payrolls report, which includes both private and public-sector employment and is compiled using a different methodology.
The Labor Department is scheduled to release its June employment report on Thursday. Economists expect total nonfarm payrolls to increase by roughly 115,000 jobs, while the unemployment rate is forecast to hold at 4.3%, providing a broader assessment of labor market conditions.
