US private sector adds fewer jobs than expected in February
By Michele Maatouk
Date: Wednesday 05 Mar 2025
(Sharecast News) - Private sector employment in the US rose less than expected in February, according to data released on Wednesday by ADP.
Employment increased by 77,000 from January, versus expectations for a 140,000 jump. The total number of jobs gained in January was revised from 183,000 to 186,000.
Small businesses with fewer than 50 employees shed 12,000 jobs, while medium businesses with between 50 and 499 employees added 46,000 jobs.
Large businesses with more than 500 employees created an additional 37,000 jobs.
The service sector added 36,000 jobs, while the goods-producing sector saw a 42,000 increase.
The figures also showed that year-over-year pay gains for job-changers slowed slightly to 6.7% in February from 6.8% the month before, while pay gains for job-stayers were flat at 4.7%.
Nela Richardson, chief economist at ADP, said: "Policy uncertainty and a slowdown in consumer spending might have led to layoffs or a slowdown in hiring last month.
"Our data, combined with other recent indicators, suggests a hiring hesitancy among employers as they assess the economic climate ahead."
Kathleen Brooks, research director at XTB, said: "The weak ADP report heaps pressure on the US NFP report for February, that is scheduled for released on Friday. The market is expecting a reading of 160k, a slight uptick from January, but still well below the 2024 average monthly rate.
"While ADP and NFP reports do not have a particularly strong positive correlation, the weakness in the private sector survey could send a chill down the spines of US bulls."
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