ADP® Reports Increased Private Sector Employment but Slower Compensation Growth in July

According to the ADP® National Employment Report™ released Wednesday (8-2-23), nonfarm private sector employment increased by 324,000 jobs in July and annual pay was up 6.2% year-over-year. The ADP National Employment Report is produced by the ADP Research Institute® in collaboration with 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 US employees. 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 near real-time measure of US 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 earning of a cohort of almost 10 million employees over a 12-month period.

Adding additional background and her analysis to the June report, Nela Richardson, ADP’s chief economist, said:

“The economy is doing better than expected and a healthy labor market continues to support household spending. We continue to see a slowdown in pay growth without broad-based job loss.”