U.S. private employers added just 44,000 jobs in July, according to the ADP National Employment Report released Aug. 5 — well short of the roughly 75,000 jobs economists had forecast, and the weakest monthly ADP reading since January. It’s a sharp slowdown from June’s revised total of 95,000.
The gains were uneven. Service-providing industries added 47,000 jobs, led by education and health services (+36,000), while goods-producing industries lost 3,000, dragged down by a 6,000-job decline in natural resources and mining. Leisure and hospitality shed 11,000 positions, and trade, transportation and utilities lost 8,000. Regionally, the Northeast led with 37,000 new jobs, while the Midwest lost 9,000. Small businesses (1-19 employees) accounted for the bulk of the gains among smaller firms, while large employers with 500 or more workers added 13,000.
Pay data offered a more pointed signal. Workers who stayed in their jobs saw pay grow 4.4% year-over-year — steady with recent months — but workers who switched jobs saw pay jump 7.0%, the fastest job-changer pay growth since August 2025. Median annual pay across ADP’s dataset came in at $62,100.
“Job-changers are highly sensitive to real-time economic conditions, and their rapid pay growth implies supply constraints in parts of the labor market,” said Dr. Nela Richardson, ADP’s chief economist. “Typical hiring patterns, meanwhile, are changing as employers react to shifting macro-economic conditions.”
The soft ADP number turned out to be a preview of an even bumpier official picture. Two days later, the Bureau of Labor Statistics reported that the broader U.S. economy — which includes government jobs that ADP’s private-sector data doesn’t capture — actually lost 23,000 jobs in July, against expectations of an 83,000 gain. That overall decline was driven by a 53,000-job drop in government employment, even as private payrolls specifically rose by 30,000 in the BLS data, a figure roughly in the same range as ADP’s estimate. The unemployment rate ticked down slightly to 4.1%, though largely because fewer people were working or looking for work. Wage growth in the BLS report slowed sharply, with average hourly earnings up just 3.2% year-over-year — the lowest reading since May 2021. BLS also revised May and June payroll figures down by a combined 103,000 jobs.
Together, the two reports point to a labor market that’s cooling faster than expected, a dynamic the Federal Reserve is watching closely as it weighs the direction of interest rates. The Fed’s rate-setting committee voted 9-3 the week prior to hold rates steady, with some officials signaling openness to a rate hike as soon as September if inflation doesn’t ease.
ADP’s next National Employment Report, covering August, is scheduled for release Sept. 2, 2026.
