Private employers added a disappointing 77,000 new jobs in February, well below the 148,000 jobs expected by the Dow Jones consensus, and far below the upwardly revised 186,000 jobs created in January, according to the payrolls processing firm ADP.
The low hiring number is one more sign that the economy may be slowing faster than many expected. The jobs figure was the lowest since July and adds to the economic worries created by a recent reduction in consumer spending and Tuesday’s announcement that the Trump administration had placed new tariffs on the nation’s three largest trading partners.
“Policy uncertainty and a slowdown in consumer spending might have led to layoffs or a slowdown in hiring last month,” said Nela Richardson, ADP’s chief economist. “Our data, combined with other recent indicators, suggests a hiring hesitancy among employers as they assess the economic climate ahead.”
The ADP National Employment Report’s list of industry sectors gaining and losing jobs showed an uneven employment market. The Leisure/hospitality category gained the most jobs, increasing by 41,000 workers. The construction and financial sectors both gained 26,000 new jobs and professional services added 27,000 jobs. Manufacturing employment increased by 18,000.
On the other side of the ledger, the transportation and utilities sector lost 33,000 jobs and the education and health services sector eliminated 28,000 positions.
For workers who stayed at the same job, February’s year-over-year pay gains were flat at 4.7%. Those that changed jobs saw an average year-over-year increase of 6.7%, down slightly from January’s average of 6.8% gain.
The Midwest gained 56,000 jobs, the most of any U.S. region. It was followed closely by the Northeast, which added 55,000 jobs. The South lost 12,000 jobs and the West lost 27,000 jobs.
Friday, the Labor Department’s Bureau of Labor Statistics will release a more complete look at job growth with the February nonfarm payroll changes. Economists surveyed by Dow Jones expect the report to show 170,000 job gains for February and the unemployment rate to be steady at 4%.
