"The number of 'small non-farm' workers is less than expected, indicating that the trend of labor weakness will continue."
On January 8, the hiring pace in the U.S. private sector slowed down in December, indicating a continued slowdown in demand for workers. Wednesday's data showed that after an increase of 146,000 people in November, ADP employment increased by 122,000 people in December, the least in four months and below market expectations. Employment growth varied across industries. Education and health services, construction as well as leisure and hospitality saw the largest increases. Manufacturing, natural resources and mining as well as professional and business services saw a decrease in employment numbers. The data suggests that the trend of a gradually weakening labor market will continue until the end of this year. Federal Reserve officials must balance this trend with renewed inflation concerns when deciding on further rate cuts for 2025 onwards. Wage growth cooled further; those who changed jobs saw wage growth of 7.1%, while those who did not change jobs had wage growth of 4.6%, which is the slowest rate since mid-2021.
Disclaimer: The content of this article solely reflects the author's opinion and does not represent the platform in any capacity. This article is not intended to serve as a reference for making investment decisions.
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