ADP® Reports Lower Private Sector Employment Gains and Reduced Compensation Growth in May

According to the ADP® National Employment Report™ released Thursday (6-1-23), nonfarm private sector employment increased by 278,000 jobs in May, and annual pay was up 6.5% 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 jobs report and pay insights use ADP’s fine-grained anonymized and aggregated payroll data of over 25 million US employees to provide a representative picture of the labor market. The report details the current month’s total private employment change and weekly job data from the previous month. ADP’s pay measure uniquely captures the earnings of a cohort of almost 10 million employees over a 12-month period.

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

“This is the second month we’ve seen a full percentage point decline in pay growth for job changers. Pay growth is slowing substantially, and wage-driven inflation may be less of a concern for the economy despite robust hiring.”